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    Growth rate of money

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    Is it possible to obtain the inflation rate, growth rate of money,and growth rate of nominal GDP with only the following information?

    Constant velocity of circulation
    real GDP growing at 3%
    real interest rate growing at 2%
    nominal interest rate at 7%.

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    https://brainmass.com/economics/inflation/growth-rate-money-29917

    Solution Preview

    Yes it is possible to obtain the inflation rate, growth rate of money,and growth rate of nominal GDP.

    inflation rate

    real interest rate = 2%
    Nominal interest rate = 7%

    (1+ nominal interest rate)= (1+ real interest rate) * ( 1+ inflation rate)
    or (1+ 7%)= (1+ 2%) * ( 1+ ...

    Solution Summary

    The solution calculates inflation rate, growth rate of money,and growth rate of nominal GDP, given Constant velocity of circulation, real GDP, real interest rate, nominal interest rate.

    $2.49

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