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all the money available in an economy
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What is the money supply of a country made up of?
all the money available in an economy
The money supply of the country is made up of what?
all the money available in an economy
What way do businesses and households both supply and demand in the circular flow model?
Households are made up of individuals who both spend money and are the recipients of money. Businesses do the same.
In what way do businesses and households both supply and demand in circular flow model?
Households are made up of individuals who both spend money and are the recipients of money. Businesses do the same.
How does Central America make money?
Central America is made up of different nations and cultures so there is no one way that money is made. Pick a country and we can give you a better answer.
What are the effects if money supply grows too rapidly?
When money supplies grow too rapidly, and product supply doesn't keep up with them, the value of money falls.
What are the roles of money supply in the economy?
Money supply determines the value of money i.e. if there are a lot of money in an economy, the value decreases and the other way around. Therefore, money supply essential decides the price of a good (if the money is worth less, the prices go up ...etc...) Hence, according to monetarists, money supply is the key ingredient of inflation (and deflation)
How is the economic environment of a country determined?
The economic environment is determinined by the laws of demand and supply. When there is high demand of goods and low supply prices are likely to go up vice versa. These goods can either be money or goods in economy.
What will interest rates do if the demand for money in the money market exceeds the supply?
If the demand for money is greater than the supply, interest rates will go up.Whenever the demand for anything is greater than the available supply, the price goes up.
Why does aggregate demand go up when money supply increases?
It doesn't. Money supply has no effect on aggregate demand. Aggregate demand is only effected by the buying power of money, real interest rate, and the real prices of exports and imports. If the supply of money goes up it only causes a short term decrease in the nominal interest rate. The price level is not accompanied by a decrease in the supply of money so the real interest rate does not rise.
What are the roles of money in the economy?
Money supply determines the value of money i.e. if there are a lot of money in an economy, the value decreases and the other way around. Therefore, money supply essential decides the price of a good (if the money is worth less, the prices go up ...etc...) Hence, according to monetarists, money supply is the key ingredient of inflation (and deflation)
Is Iran a country or state?
Iran is a country made up of many provinces.
