Graphing out Money Demand at two different levels of income.
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Can you please draw this graph for me.
The horizontal axis of your graph should be labeled real money balances, and the vertical axis of your graph should be labeled interest rate.
The points on demand for money curve when income equals 11,940 are: (2,675, 4.4); (2,750, 4.7); (2,735, 5.0); (2,720, 5.3); (2,705, 5.6); (2,690, 5.9); and (2,675, 6.2).
The points on demand for money curve when income equals 12,180 are:
(2,825, 4.4); (2,810, 4.7); (2,795, 5.0); (2,780, 5.3); (2,765, 5.6); (2,750, 5.9); and (2,735, 6.2).
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Solution Summary
Given a set of data points for money demand and interest rates (at two different income levels) a plot is created in Microsoft Word and Excel (see attachment). The money demand function is plotted out for two different income levels (where income shifts money demand).
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