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Nadusha1986 [10]
3 years ago
14

Assume that the money demand function is (M/P)d = 2,200 – 200r, where r is the interest rate in percent. The money supply M is 2

,000 and the price level P is 2. If the price level is fixed and the Fed wants to fix the interest rate at 7 percent, it should set the money supply at:
Business
1 answer:
liubo4ka [24]3 years ago
6 0

Answer: The nominal money supply should set at 1,600.

Explanation:

Given that,

Money demand function: (M/P)d = 2,200 – 200r

r - Interest rate

Money supply (M) = 2,000

Price level (P) = 2

If the fed wants to set the interest rate at 7% then,

Money supply = money demand

(\frac{M}{P})^{s} = (\frac{M}{P})^{d}

\frac{M}{P} = 2,200 – 200r

P = 2 and r = 7%

\frac{M}{2} = 2,200 – 200 × 7

                            M = 800 × 2

                            M = 1,600

The nominal money supply should set at 1,600.

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Answer and explanation:

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In such a case, <em>we should recommend our friend to take a look at the Democracy Index where he or she will find out that the U.S. is not one of the fairest nations in the world. Its government functioning and political participation are aspects where the U.S. needs improvement.</em>

6 0
3 years ago
Orion would like to go on a trip to Ireland in two years. He wants to have $3,000 for the trip, so he is planning to invest mone
denis-greek [22]

Answer:

The answer is: If Orion wants to have $3,000 in two years, he must invest $2,572.02 today

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P = FV / (1 + r)²    

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P = $3,000 / 1.1664

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4 0
3 years ago
Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have not been closed. For a c
alexandr402 [8]

There is some information missing and I looked up it. If the numbers are not exactly the same, you adjust them to your question.

  • The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $166,436.
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  • A check for $4,000 returned with the statement had been incorrectly recorded by Pala Medical Co. as $400. The check was for the payment of an obligation to Skyline Supply Co. for a purchase on account.
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Answer:

June 30, 20Y1

Dr Cash 26,500

    Cr Notes receivable 25,000

    Cr Interest revenue 1,500

Dr Cash 3,600

    Cr Accounts receivable 3,600

Dr Bank fees expense 55

    Cr Cash 55

If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1, what amount should be reported as cash?

$166,436 + $26,500 + $3,600 - $55 = $196,481

6 0
3 years ago
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In conclusion I think that volleyball is actually a really good game because by the time you are done playing either you win or you lose you are aready out of energy. So no volleyball is not a stupid game because it is like any other sprt it is a winner and loser game.

I hope this helps :)

8 0
3 years ago
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Answer: Acceptability, portability and divisibility of money.

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The question illustrates the acceptability, portability and the divisibility of money. The acceptability of money means that money is widely accepted as a medium for transaction, divisibility of money means that money can be broken down to smaller denominations and the portability of money means that money is easy to carry about.

7 0
3 years ago
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