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Handout 9.1: Interest Rates Interpret the following graph showing the potential changes in supply of money compared to the demand for money. The demand for money is represented by line MD and the initial supply of money is represented by line MS. Then answer the questions below. Change in IÇerest Rates Interest Rate MS1 MS MS2 Font 7 A B 4 MD .7 .8 .9 1 1.1 1.2 1.3 Quantity of money Find the new equilibrium points Use the graph to explain why changes in the supply of money affect the quantity of money demanded 3.

Handout 9.1: Interest Rates Interpret the following graph showing the potential changes in supply of money compared to the demand for money. The demand for money is represented by line MD and the initial supply of money is represented by line MS. Then answer the questions below. Change in IÇerest Rates Interest Rate MS1 MS MS2 Font 7 A B 4 MD .7 .8 .9 1 1.1 1.2 1.3 Quantity of money Find the new equilibrium points Use the graph to explain why changes in the supply of money affect the quantity of money demanded 3.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Use the graph to explain why changes in the supply of money affect the quantity of money demanded.

 

Handout 9.1: Interest Rates Interpret the following graph showing the potential changes in supply of money compared to the demand for money. The demand for money is represented by line MD and the initial supply of money is represented by line MS. Then answer the questions below. Change in Ierest Rates Interest Rate MS1 MS MS2 Font 7 A 5 B 4 MD .7 .8 .9 1 1.1 1.2 1.3 Quantity of money Find the new equilibrium points Use the graph to explain why changes in the supply of money affect the quantity of money demanded to
Transcribed Image Text:Handout 9.1: Interest Rates Interpret the following graph showing the potential changes in supply of money compared to the demand for money. The demand for money is represented by line MD and the initial supply of money is represented by line MS. Then answer the questions below. Change in Ierest Rates Interest Rate MS1 MS MS2 Font 7 A 5 B 4 MD .7 .8 .9 1 1.1 1.2 1.3 Quantity of money Find the new equilibrium points Use the graph to explain why changes in the supply of money affect the quantity of money demanded to
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