Question
HI , i just need the correct answer to these 5 multiple choice questions . no explanation needed just the correct answer. -------- Q1 .
HI , i just need the correct answer to these 5 multiple choice questions . no explanation needed just the correct answer.
--------
Q1 .
The Central has announced that it plans to lower the rate of monetary growth from 10% per year to 2% per year. You would expect this announcement to directly
A) increase money demand, shifting the LM curve up and to the left.
B) increase money demand, shifting the LM curve down and to the right.
C) decrease money demand, shifting the LM curve up and to the left.
D) decrease money demand, shifting the LM curve down and to the right.
Q2 .
Suppose real money demand is L = 0.8 Y - 100,000 (r + e). If the nominal money supply is 10,000, real output is 15,000, the real interest rate is .02, and the expected inflation rate is .01, then the price level is
A) 0.75.
B) 0.95
C) 1.0.
D) 1.11
Q3.
Money demand is given by Md/P = 1000 + .2Y - 1000i. Given that P = 300, Y = 1000, and i = .20, velocity is equal to
A) 0.75.
B) 0.85.
C) 1.33.
D) 1.00
Q4 .
A country has a current account surplus if
A) the value of its exports exceeds the value of its imports, assuming net income from foreign assets and net unilateral transfers have a value of zero.
B) the value of its net exports of services exceeds the value of its net exports of goods.
C) it receives more income from foreign assets than it pays to foreigners for foreign-owned domestic assets.
D) its capital inflows exceed its capital outflows.
Q5.
Suppose the real money demand function is Md/P = 2500 + 0.2 Y - 10,000 (r + e). Assume M = 5000, P = 2.0, e = .02, and Y = 10,000. The real interest rate that clears the asset market is
A) 6%.
B) 9%.
C) 11%.
D) 18%.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started