a) Assume that each dollar held for transactions purposes is spent on the average five times per year to buy final goods and services. If the nominal GDP is $10,000 billion ($10 trillion), what is the transaction demand (D¿)? $ billion, because b) The table below shows the asset demand at certain rates of interest. Using your answer to part (a) complete the table to show the total demand for money at various rates of interest. Interest rate Asset demand Total demand (in %) (billions), (Da) $ 30 (billions), (Dm) 10 $. 60

a) Assume that each dollar held for transactions purposes is spent on the average five times per year to buy final goods and services. If the nominal GDP is $10,000 billion ($10 trillion), what is the transaction demand (D¿)? $ billion, because b) The table below shows the asset demand at certain rates of interest. Using your answer to part (a) complete the table to show the total demand for money at various rates of interest. Interest rate Asset demand Total demand (in %) (billions), (Da) $ 30 (billions), (Dm) 10 $. 60

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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