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elixir [45]
3 years ago
7

Suppose that this year's money supply is $500 billion, nominal GDP is $10 trillion, and real GDP is $5 trillion. The price level

is , and the velocity of money is . Suppose that velocity is constant and the economy’s output of goods and services rises by 5 percent each year. Use this information to answer the questions that follow. If the Fed keeps the money supply constant, the price level will , and nominal GDP will . If the Fed wants to keep the price level stable instead, it should next year. If the Fed wants an inflation rate of 10 percent instead, it should . (Hint: The quantity equation can be rewritten as the following percentage change formula:

Business
1 answer:
MakcuM [25]3 years ago
4 0

Answer:

Please see attachment

Explanation:

Please see attachment

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The correct answer to this open question is the following.

Although you did not attach the text, we can comment on the quote.

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