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Describe the essential features of a model economy in a monetary market of rational people for...

Describe the essential features of a model economy in a monetary market of rational people for which each of the following statements is true: (These features might include the pattern of population growth, monetary growth, endowments, and government policies. Note that there may be more than one model that yields the given results.)

a. The gross rate of return on fiat money is 1. The monetary equilibrium does not maximize the utility of the future generations.

b. The price level doubles from period to period. The monetary equilibrium also maximizes the utility of the future generations.

c. The gross rate of return on fiat money is 1. The monetary equilibrium also maximize the utility of the future generations.

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Rahul Sunny answered 8 months ago
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