Question: Please answer this question in complete detail. also show working and tables where it is necesary. and also show every process and each steps. Q5

Please answer this question in complete detail. also show working and tables where it is necesary. and also show every process and each steps.

Please answer this question in complete detail. also show working and tables

Q5 (5 marks) Page 3 of 4 Suppose the money demand function is " = 1000 + 0.2Y - 1000 (r + me). Required (a.) Calculate velocity if Y = 2000, r = 0.06, and me = 0.04. (b.) If the money supply (MS) is 2600, what is the price level? (c.) Now suppose the real interest rate rises to 0.11, but Y and MS are unchanged. What happens to velocity and the price level? (d.) For part (c.), if the nominal interest rate were to rise from 0.10 to 0.15 over the course of a year, with Y remaining at 2000, what would the inflation rate be

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