Again, consider an economy with real output of 400 and an average price level of $2. While velocity and the price level are constant, this economy's real output is increasing by 1.25 percent per year. Recall also that the average dollar in this economy is spent 10 times over a year, Calculate the percentage change in the money supply this economy is experiencing. Enter your answer "as a percent, but without the percentage sign." Show an increase in the money supply with a positive number (no sign) and a decrease with a negative number (with negative sign). For example, if the money supply is falling by 99 percent, enter only -99 in the blank.
Again, consider an economy with real output of 400 and an average price level of $2. While velocity and the price level are constant, this economy's real output is increasing by 1.25 percent per year. Recall also that the average dollar in this economy is spent 10 times over a year, Calculate the percentage change in the money supply this economy is experiencing. Enter your answer "as a percent, but without the percentage sign." Show an increase in the money supply with a positive number (no sign) and a decrease with a negative number (with negative sign). For example, if the money supply is falling by 99 percent, enter only -99 in the blank.
Chapter16: Monetary Policy
Section: Chapter Questions
Problem 8SQ
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Again, consider an economy with real output of 400 and an average price level of $2. While velocity and the price level are constant, this economy's real output is increasing by 1.25 percent per year. Recall also that the average dollar in this economy is spent 10 times over a year,
Calculate the percentage change in the money supply this economy is experiencing. Enter your answer "as a percent, but without the percentage sign." Show an increase in the money supply with a positive number (no sign) and a decrease with a negative number (with negative sign). For example, if the money supply is falling by 99 percent, enter only -99 in the blank.
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