23. The sum of coins, currency, demand deposits, and checkable deposits is called Group of answer choices a. National income. b. Nominal income, c. M1. d. Fractional reserves. e. Cash.
Q: Discuss what hyperinflation is. What does hyperinflation do to an economy and society? In other…
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A: According to the quantity theory, (M x V) = (P x Y).
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A: NOTE: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…
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Q: Differentiate between real flows and monetary flow
A: In circular flow of income there are two types of flows, they are money flow and real flow.
Q: T chart of Canny bank Assets Liabilities Reserve: $10,000 Demand Deposit: $200,000 Government bonds:…
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A: Money refers to anything that accepted for transaction of goods and services.
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A: GDP is the value of goods and services produced in the economy within a given period of time.
Q: Consider a simple economy that produces only pens. The following table contains information on the…
A: Given; In 2018 Money supply= $200 Price of pen= $5.00 Quantity produced= 400 pens
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Q: 33. Which of the following statements istrue? Almost all hyperinflations follow the same pattern…
A: Hyperinflation is a term used to describe rapid, excessive, and out-of-control price increases in an…
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A: Here, given information is: Money growth rate: 3% Real GDP growth rate: 5% Real Interest rate: 0%
Q: Assume GDP is currently $12,800 billion per year and the quantity of money is $512 billion. What…
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Q: 4. Velocity and the quantity equation Consider a simple economy that produces only pies. The…
A: Quantity theory of money says MV = PY M= money V= Velocity P= price Y= real GDP
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A: Hyperinflation: It refers to a situation when the prices in the economy start rising sharply and the…
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A: As per the Federal Reserve, Before May 2020, M1 = Currency in circulation + Checkable deposits
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A: Peoples desire to hold money mainly for transactional purposes. This is to carry out day to day…
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Q: The real value of of money depends on ______. a. Aggregate inputs b. National Income c. Aggregate…
A: We have to find following question.
Q: Find real GDP in classical mode
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A: The velocity of money indicates that the number of times a unit of money changes hands in given…
Q: Assume that the money supply in an economy is $900 million, the velocity of money is constant at 5,…
A: Given: Money supply = $900 million Velocity of money = 5 price per unit of output = $3
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A: Tax = 25% Speculation = $60bn Import/export balance = $2.5bn Government consumption = $270 GNP =…
Q: If real output in an economy is 1,500 goods per year , the money supply is $ 350 , and each dollar…
A: The quantity theory states that Money supply x Velocity of circulation = Price level x Real output
Q: b) How are nominal GDP and the money supply related? Be specific.
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Q: Consider a simple economy that produces only cell phones. The following table contains information…
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Q: 8 During rapid inflation or hyperinflation: a. The real value of money falls. b. People will be…
A: Introduction Hyperinflation means that economy has a higher rate of inflation. Prices of all goods…
Q: Other things the same, as the price level rises, the real value of a dollar Answer rises, and…
A: The value of a currency both domestically (purchasing power of money) and internationally (Exchange…
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A:
Q: Explain the quantity theory of money. How are the changes in values of money measured
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23. The sum of coins, currency,
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- If C = 5 + 0.6Y, I = 4 – 0.2 r, G = 5, T = 6, X = 10 dan M = 10 + 0.3 Y, Ms = 20, Mdt = 0.1 Y and Mds = 5 – 0.1 r where C is consumption expenditure, Y is income, I is investment, G is government expenditure, T is tax, X is export, M is import, Ms is money supply, Mdt is money demand for transactian and Mds money demand for speculation. Form the IS curve for the economy above.Which of the following would indicate that the dollar amount being analyzed is money? a. M1 money stock of $1.4 trillion at the end of 2010 b. The first quarter of 2002 c. Microsoft profits of $500 billion in 2010 d. Nominal GDP in 2010 of $14.7 trilliona. tax increase b. economic growth c. expected inflation d. income increase e. currency appreciation f. technology breakthrough Which ones of the above economic factors will increase money supply? Which ones of the above economic factors will increase demand for money ?
- PT. XYZ exports rubber to Japan and at the same time imports electronic goods from Japan. Give an illustration of how PT. XYZ hedges its future revenues using the money market. Notes : Use your own numbers in making calculations!Problem a)Discuss the main functions of money b)Consider that the Ghanaian economy is a Small and close, which ischaracterised by the following.AD=C+I+G+NXC=a+bY*Y*=disposalincomeT=T 0I=I 0G=G0Md/P=Ld(Y,i)Ms=money supply, which is given.AD=Aggregate demand, C=consumption, G=Government expenditure, T=Tax, P= Price level, I=Investment, NX=Net exportsa)Consider an increase in Government spending ∆ > .Assume for now thatboth price and expected price are fixed. Also assume that government doesnot implement any other policy than the increase in Government spending.What is the effect of this policy on the goods market? b)What is the effect on equilibriumin the money market? Present your answer ina well-labelled diagram, showing both money supply and demand before thepolicy was implemented, and that after the policy was implemented in thesame graph. c)Solve for equilibrium in the goods market.d)Suppose the policy change is rather an increase in real money supply not a decrease in government…Consider an economy where the monetary base is equal to $3,500 million. People hold onequarter (1/4th ) of their money in the form of currency and the remainder as bank deposits. Banks have a reserve-deposit ratio of 0.25 . a. What is the nation's money supply equal to? b. One day, COVID emerges as a public health emergency and people are forced to stay at home. As a result, people now hold only 1/8th of their money in the form of currency (and the remainder as bank deposits.) If banks maintain their reserve-deposit ratio of 0.25 and central bank does nothing, what is the new money supply? c. If, in the face of this crisis, the central bank wants to conduct an open market operation to keep the money supply at its original level, does it buy or sell government bonds? Calculate, in dollars, how much the central bank needs to buy/sell.
- Discuss what hyperinflation is. What does hyperinflation do to an economy and society? In other words, how does it change the way people live their lives and transact business? Is hyperinflation something we want for the U.S. economy? Discuss in 4 to 5 complete and well-written sentences?Consider an economy in which the money supply consists of both currency and deposits. The growth rate of the monetary base, the growth rate of the money supply, inflation, and expected inflation all are constant at 10% per year. Output and the real interest rate are constant. Monetary data for this economy as of January 1, 2016, are as follows: Currency held by nonbank public $200 Bank reserves $50 Monetary base $250 Deposits $600 Money supply $800 a. What is the nominal value of seignorage over the year? (Hint: How much monetary base is created during the year?) b. Suppose that deposits and bank reserves pay no interest, and that banks lend deposits not held as reserves at the market rate of interest. Who pays the inflation tax (measured in nominal terms), and how much do they pay? (Hint: The inflation tax paid by banks in this example is negative.) c. Suppose that deposits pay a market rate of interest. Who pays the inflation tax, and how much do they pay?The _____ and the the interest rate, the _____ the opportunity cost of holding money, M1 money people will want to hold. higher; higher; more lower; higher; less lower; lower; more higher; lower; more
- South Africa, March 18 ‐ Repurchase rate: 6.25% Inflation rate: 4.5% (January) Based on the projections of the repurchase rate in the extract above. Explain, with the aid of a graph, the impact of a cut in the interest rate on the demand for money.Money velocity in the country of Ecoland is always stable. In 2019 (the base year), the money supply was $250 billion. In 2020, the money supply increased to $350 billion, the price level increased by 25 percent, and nominal GDP equaled $1400 billion. By how much did real GDP increase between 2019 and 2020? A) $15 billion B) $ 50 billion C) $12.5 billion D) $150 billionWhich of the following are considered money in theU.S. economy? Which are not? Explain your answersby discussing each of the three functions of money.a. a U.S. pennyb. a Mexican pesoc. a Picasso paintingd. a plastic credit card