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Assume the following: i. The public holds no currency. ii. The ratio of reserves to deposits (9) is 0.08. iii. The demand for money is
Assume the following: i. The public holds no currency. ii. The ratio of reserves to deposits (9) is 0.08. iii. The demand for money is given by Md = $Y{0.85 - 3.2:). Initially, the monetary base (H ) is $65 billion, and nominal income ($Y) is $5,300 billion. Calculate the demand function for central bank money: H"=(D)>
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