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What factors influence the demand for money?
In the simplest models, the supply of money and the real interest rate.
When is the LM curve relatively steep?
If money demand has low sensitivity to change in interest rate,the interest rate would have to rise by a large amount to reduce the demand for real balance back to the fixed leveli.e the level at which demand for money is equal to supply of money.Accordingly,the LM curve would be quite steep
Which of the following adjusts to bring aggregate supply and demand into balance?
The price level and real output.
What would be the effect on the demand for narrow money if an increase in real GDP?
what's the answer?
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 factors influence the demand for money?
In the simplest models, the supply of money and the real interest rate.
When is the LM curve relatively steep?
If money demand has low sensitivity to change in interest rate,the interest rate would have to rise by a large amount to reduce the demand for real balance back to the fixed leveli.e the level at which demand for money is equal to supply of money.Accordingly,the LM curve would be quite steep
Which of the following adjusts to bring aggregate supply and demand into balance?
The price level and real output.
What would be the effect on the demand for narrow money if an increase in real GDP?
what's the answer?
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.
Why is there an increase of plus sized models?
It's more than likely because of consumer demand. Sizes of real women outside of the modeling industry are getting larger and as such they are creating demand for fashions that are in their sizes. More designers are finding they can make more money by focusing on the plus size industry and increase their sales as well as maximize their exposure at the same time. As a result of this new demand, the designers and agencies turn to the plus size models to carry out their needs.
Why is money suppy a major determinant of interest rates?
Because: Real interest rate occurs when real money demand = money supply When money supply changes, the equilibrium interest rates changes as this equation shows.
Why did real money demand rise much more than real GDP?
Real money demand often rises more than real GDP due to factors like increased transaction needs and heightened precautionary motives among individuals and businesses. During periods of economic uncertainty or inflationary expectations, people tend to hold more cash as a safeguard against potential financial instability. Additionally, financial innovation and the growth of electronic payments can lead to a greater demand for liquidity, further amplifying the divergence between real money demand and GDP growth.
Is it true that computer models save time lives and money?
Other models are used because working and testing a model can be safer and less expensive than using the real things.Some of these models.
What is the real difference between balance of trade and balance of payment?
Balance of Trade is the accounting of goods and service imported and exported. Balance of Payments is the accounting of money owed and loaned other nations.
What is equilibrium in a real estate market?
The state in which real estate market supply and demand balance each other and, as a result, prices become stable. Generally, when there is too much supply for goods or services, the price goes down, which results in higher demand. The balancing effect of supply and demand results in a state of equilibrium.
How does a decrease in the price level impact real wealth and aggregate demand?
A decrease in the price level can increase real wealth because people's money can buy more goods and services. This can lead to an increase in aggregate demand as consumers are more willing to spend money, which can stimulate economic growth.
