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let the money demand function be: L(r,Y) =50 -25r +5Ywhere r is the real interest rate.Suppose the price level isP =2 and the money supply

let the money demand function be: L(r,Y) =50 -25r +5Ywhere r is the real interest rate.Suppose the price level isP =2 and the money supply is MS=500.Which of the following equations describes the equilibrium in the money market?

  1. Y-5r=40
  2. 2Y-5r=40
  3. Y-2r=40
  4. 3Y-5r=40

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Let the consumption function be : C = 10 + 050' - T) and the investment function be: I = 17 - F where r is the real interest rate, T denotes taxes and G denotes government expenditures. Let T=10 and 6:5. Which of the following equations describes the equilibrium in the loanable funds market? r+2Y=54 A K , J 2r+Y=54 /'\\ 1." 5r+Y=54 IA '4' 2r+3Y=54

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