suppose a country has perfectly interest elastic investment demand and low interest elasticity of money demand.Uesing Is-lm analysis, explain the effect of an increase in money demand due to non income determinant on the output and interest rate of this economy when money stock target is uesd as intermediate target. how the result differs from interest rate targeting? which option is better for the economy of this country;monetary or interest rate targeting? justify answer pleas.

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In an ISLM analysis an increase in money demand due to a nonincome determinant would shift the LM cu... View the full answer