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The demand for money in a country is given by = 10,000 10,000 + Where is money demand in dollars, is the interest rate (a
The demand for money in a country is given by
= 10,000 10,000 +
Where is money demand in dollars, is the interest rate (a 10 percent interest rate means 10 100 = 0.1), and is national income. Assume = $5000 initially.
Graph the money demand function. Label x-axis (horizontal axis) as the quantity of money demanded, and y-axis (vertical axis) as the interest rate.
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