If velocity were constant at 2 while M2 rose from $5 trillion to $6 trillion in a single year, what would happen to nominal GDP? If real GDP rose 3 percent, what would be the level of inflation?
Answer to relevant QuestionsExplain why we observed a fall in the velocity of M2 during the financial crisis of 2007-2009. A scatter plot can reveal a relationship between two indicators. Construct a scatter plot of annual data beginning in 1959 for inflation and money growth. Measure these as the percent change from a year ago of consumer ...Suppose that the aggregate expenditure curve can be expressed algebraically as AE = 3,000 – 2,000r,Where AE is aggregate expenditures and r is the real interest rate expressed as a decimal. You check the website of the ...Suppose a natural disaster wipes out a significant portion of the economy’s capital stock, reducing the potential level of output. What would you expect to happen to the long-run real interest rate? What impact would ...How sensitive is private investment to risk? Plot since 2004 the share of real gross private domestic investment (FRED code: GPDIC1) in real GDP (FRED code: GDPC1) and (on the right scale) a measure of anticipated stock ...
Post your question