A standard "money demand" function used by macroeconomists has the form In(m) = Bo + ByIn(GDP) + B2R, Where m is the quantity of (real) money, GDP is the value of (real) gross domestic product, and R is the value of the nominal interest rate measured in percent per year. Supposed that B, = 2.28 and fz = - 0.09. What is the expected change in m if GDP increases by 1%? The value of m is expected to increase by approximately 2 %. (Round your response to the nearest integer) What is the expected change in m if the interest rate increases from 1% to 6%? The value of m is expected to decrease by approximately 45 %. (Round your response to the nearest integer)

A standard "money demand" function used by macroeconomists has the form In(m) = Bo + ByIn(GDP) + B2R, Where m is the quantity of (real) money, GDP is the value of (real) gross domestic product, and R is the value of the nominal interest rate measured in percent per year. Supposed that B, = 2.28 and fz = - 0.09. What is the expected change in m if GDP increases by 1%? The value of m is expected to increase by approximately 2 %. (Round your response to the nearest integer) What is the expected change in m if the interest rate increases from 1% to 6%? The value of m is expected to decrease by approximately 45 %. (Round your response to the nearest integer)

Name: A standard "money demand" function used by macroeconomists has the fo
Uploaded: 2024-03-20T07:06:41.000Z
Channel: Bartleby
Description: A standard "money demand" function used by macroeconomists has the formIn(m) = fo + B,In(GDP) + 62R,Where m is the quantity of (real) money, GDP is the value of (real) gross domestic product, and R is the value of the nominal interest rate measured