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What is the transactions demand for money in this market? Use the graph below to answer the following questions: Dt is the transactions demand for
What is the transactions demand for money in this market?
Use the graph below to answer the following questions: Dt is the transactions demand for money, D is the total demand for money, and Sm is the supply of money. 1. What is the transactions demand for money in this market? 2. What the asset demand for money if the interest rate is 2 %? Number Number 3. If the money market is in equilibrium at 4 %, what change in money supply must occur for the equilibrium rate to change to 2 % (include a negative if a decrease in money supply) Number 4. If the money market is in equilibrium at 6 % and the money supply has increased to Sm3 by how much has total demand for Number money changed? 6 4 2 Sml 110 160 Sm2 210 Sm3 Dm 260 QuantiW of Money
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