Answered

Westonci.ca is the best place to get answers to your questions, provided by a community of experienced and knowledgeable experts. Get immediate and reliable solutions to your questions from a community of experienced professionals on our platform. Get precise and detailed answers to your questions from a knowledgeable community of experts on our Q&A platform.

If the supply of real balances is 300, and the gross domestic product is 90, then the equilibrium interest rate is

Sagot :

Baraq

Suppose that the demand for real balances is (M / P)d = (5Y) - (20r). If the supply of real balances is 300, and the gross domestic product is 90, then the equilibrium interest rate is

Answer:

7.5

Explanation:

Given that (M / P)d = (5Y) - (20r).

Where supply of real balances is 300

The gross domestic product is 90

Hence we have 300 = (5Y) - (20r)

Therefore, we have 300 = (5×90) - (20r)

=> 300 = 450 - 20r

=> 20r = 450 - 300

=> 20r = 150

=> r = 150 ÷ 20

=> r = 7.5

Therefore, in this case, the correct answer to the question is that the equilibrium interest rate is 7.5

Thanks for stopping by. We are committed to providing the best answers for all your questions. See you again soon. We appreciate your time. Please revisit us for more reliable answers to any questions you may have. Get the answers you need at Westonci.ca. Stay informed with our latest expert advice.