Suppose that money demand is given by

Md=$Y(0.25i)

where $Y is $250 and i denotes the interest rate in decimal form.Also, suppose that the supply of money is $50.

Calculate the equilibrium interest rate as a percent.:

a. The equilibrium interest rate is _________(Round your response to two decimal places.)

If the Federal Reserve wants to increase the interest rate by 5 percentage points (0.05 in decimalform) over and above the equilibrium interest rate determinedabove, at what level should it set the moneysupply?

The money supply should be set at $_________ (Round your response to one decimal place.)