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The relationship between the value of money and the price level in an economy is?
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∙ 14y ago
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Wiki User
∙ 14y ago
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The relationship between the value of money and the price level?
There is an inverse relationship between value of money and the price level. So if the value of money is low, then the price level is high or if the value of money is high, then the price level is low.
What does too much money in the economy lead to?
A high level of capital in the economy exerts and inflationary pressure. With this, prices can rise and the value of the money goes down.
What factors that affects the demand for money?
The major factors that affect the demand for money are price level, interest rates, economy, and the price of money.
What is a money economy and a no money economy?
when u have money for devoloped annd not
Why rise in price level cause interest rates rise?
Interest rates can be thought of as the cost of money. Therefore assuming a fixed amount of money in the economy, if the price level increases, real income decreases and consequently money may have to be borrowed in order to maintain real income. But because there's a fixed amount of money in the economy there will be more demand for money than there'd be supply of. In essence, the increase in the price level, increases the demand of money and also the price of money which, coincidently, is the interest rate.
The relationship between the value of money and the price level?
There is an inverse relationship between value of money and the price level. So if the value of money is low, then the price level is high or if the value of money is high, then the price level is low.
What is Time interest and money relationship in engineering economy?
then get a 15000000 for one mouth
Is the level of competition high or low in the economy?
It is high because everyone in the economy is trying to make money.
What does too much money in the economy lead to?
A high level of capital in the economy exerts and inflationary pressure. With this, prices can rise and the value of the money goes down.
What is Money economy?
money economy is an economy money
What factors that affects the demand for money?
The major factors that affect the demand for money are price level, interest rates, economy, and the price of money.
What is importance of foreign capital inflows to the economy of namibian economy?
it has to do with all the money exchanged between countries
What is the relationship between money and prayer?
Play the lottery. Pray you win. There's your relationship.
What is relationship between prayer and money?
Play the lottery. Pray you win. There's your relationship.
What is the relationship between insurance and successful financial management?
money
What is are the differences between Friedman's quantity theory of money and that of Irving fisher's?
Friedman's quantity theory of money focuses on long-run changes in money supply and its relationship with nominal income. Fisher's quantity theory expands on this to account for both short-run and long-run changes in money supply and velocity of money. Fisher also incorporates the concept of the equation of exchange to explain the relationship between money supply, velocity, price level, and real income.
What is the relationship and proportioned powers that exists between the buyer and the supply?
The monetarist explanation of inflation operates through the Quantity Theory of Money, MV = PT where M is Money Supply, V is Velocity of Circulation, P is Price level and T is Transactions or Output. As monetarists assume that V and T are determined, by real variables, there is a direct relationship between the growth of the money supply and inflation. ChaCha again!
