Question: Help 03 [50 points] Suppose that a person's wealth is $ 100,000 and that her yearly income is $ 120,000. Also suppose that her money

Help 03 [50 points] Suppose that a person's wealth is $

Help

03 [50 points] Suppose that a person's wealth is $ 100,000 and that her yearly income is $ 120,000. Also suppose that her money demand function is given by M6 = \"(0.45 - i) aDerive the demand for bonds. Suppose the interest rate increases by 20 percentage points. What is the effect on her demand for bonds? '0. How can an increase in the interest rate make bonds more attractive and reduce their price? Explain in detail. 0. What are the effects of an increase in wealth on her demand for money and her demand for bonds? Explain in words. d.What are the effects of an increase in income on her demand for money and her demand for bonds? Explain in words. e. Consider the statement: \"When people earn more money, they obviously will hold more bonds.\" What is wrong with this statement

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