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The Money Market and Interest Rate 6. Assume that the demand for real money balances is given by Md/P=Y/6150i (an interest rate of 2% enters this formula as 2 ). Suppose that Y= 12,900 billion, so that Md/P=12,900/6150i (in billion of $ ) a) Calculate the demand for real money balances if the interest rate is 4%,3%, and 1% respectively. b) Plot these points on a graph with the nominal interest rate on the vertical axis and the quantity of real money balances in the horizontal axis