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Macroeconomics Homework - Q & A

   

Added on  2022-08-08

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Running head: MACROECONOMICS HOMEWORK 8
Macroeconomics Homework 8
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MACROECONOMICS HOMEWORK 81
Table of Contents
Answer 1..........................................................................................................................................2
Case #1.........................................................................................................................................3
Case #2.........................................................................................................................................5
Answer 2..........................................................................................................................................7
Answer 3..........................................................................................................................................7
Reference.........................................................................................................................................9

MACROECONOMICS HOMEWORK 82
Answer 1
(a) Market clearing real interest rate:
M d
P =1500+0.2 Y 10000(r+ π e)
¿ , 4000
2 =1500+(0.2× 5000)10000(r +0.01)
¿ , 2000=1500+100010000 r100
¿ , 10000 r=400
¿ , r=0.04
(b)
Figure 1: Money demand and supply equilibrium
Source: (Created by the Author)

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