ssume that the following data characterize a hypothetical economy of Sener: money supply = $360 billion;...

ssume that the following data characterize a hypothetical economy of Sener: money supply = $360 billion; quantity of money demanded for transactions = $240 billion; quantity of money demanded as an asset = $20 billion at 12 percent interest, increasing by $20 billion for each 2-percentage-point fall in the interest rate.

show the total D_M and S_m in a graph and what is the equlibrium interest rate

Expert Solution

equilibrium interest rate is 2%

At this rate total money supplied = total money demanded = 360 billion

Explanation:

Rahul Sunny answered 9 months ago

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