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kramer
3 years ago
12

The rules-based monetary policy reads: The annual growth rate in the money supply will be equal to the average annual growth rat

e in Real GDP minus the growth rate in velocity. If the average growth rate in Real GDP this year is 3 percent and the growth rate in velocity is 2 percent, then the money supply will increase by ______________ percent this year.
Business
1 answer:
Goshia [24]3 years ago
3 0

Answer:

the increase in the money supply is 1%

Explanation:

The computation of the increase in the money supply is given below;

The increase in the money supply is

= Growth rate in Real GDP - Growth rate in velocity

= 3% - 2%

= 1%

Hence, the increase in the money supply is 1%

It would be come by subtracting the two items from each other so that the accurate percentage could come

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