The demand for money in a country is given by: Md = 200,000 - 200,000r +Y
Where Md is money demand in dollars, r is the interest rate (a 10% interest rate = r = .1), and Y is national income. Assume Y is initially 1,000,000.

a. Suppose the money supply is set by the central bank at $1,198,000. What is the equilibrium interest rate?
b. Suppose income decreases from 1,000,000 to 999,000 determine the new equilibrium interest rate.
c. If the central bank wants to keep the interest rate the same as in part a, by how much should it increase or decrease the money supply?

Solution Preview

The demand for money in a country is given by: Md = 200,000 - 200,000r +Y
Where Md is money demand in dollars, r is the interest rate (a 10% interest rate = r = .1), and Y is national income. Assume Y is initially 1,000,000.

a. Suppose the money supply is set by the central bank at $1,198,000. What is the equilibrium ...

Solution Summary

Solution depicts the steps to find the equilibrium interest rate in the given case.

Suppose the total demand for money is described by the following equation:
MD = 30-2i
where i is the prevailing market interestrate. The total supply of money is described by the following equation:
MS = 3 + 7i
According to liquidity preference, what is theequilibriuminterestrate?

IS/LM Homework
The economy of Econoville consists of two markets as follows:
Product Market
C = 2.0 + 0.70 Yd
I = 3.0 + 0.12 Y - 0.20(r) %
Yd = Y - T
Y = C + I + G
G = 12
T = 10
Money Market
MS = 12.0
MD = 4.0 + 0.20Y - 0.4(r) %
MD = MS
Part a
Derive the IS curve for Econoville
Part b
Derive

Can you show me how to set up the equation?
What is theequilibrium constant if theequilibrium concentrations at 74 degrees centigrade to form carbonyl chloride are
[CO]=1.2 x e-2 M
[Cl2]=0.054 M
[COCl2]= 0.14M
CO(g) + Cl2(g)= COCl2(g)

This is problem having troubles with.
Determined at 1123 K.
C(s)+Co2(g) >2CO(g) K'p=1.3 x 10^14
<
CO(g) + Cl2(g)>COCl2(g) K"p=6.0 x 10^-3
Equilibrium constat expression Kp for reaction
C(s) + CO2(g)+2Cl2(g)>2COCl2(g)
Kp=(PCOCL2)^2/((PCl2)^2 x (PCO2))
Calculate theequilibrium constant at 1123K

Can someone help me in calculatingthe current real interestrate? I know the formula is:
Real interestrate = nominal interestrate - inflation rate.
I am getting confused on whether I should use the published inflation rate for January or would it be a different number. I am also confused on what nominal interestrate t

If the Federal Reserve where ready to cut interestrates next week and officials indicated today that a quarter-point cut in federal funds remains firmly on the table, despite market expectations of a half-point cut.
Please answer the following showing all of your work:
1) Before the Fed's action theequilibrium income and

Theequilibrium constant Kc for the reaction shown below is 3.8 x 10-5 at 727°C.
I2(g) = 2 I(g)
Calculate Kc and Kp for the following equilibrium at the same temperature.
2 I(g)= I2(g)
Since they give us first rxn Kc do I first take the inverse (to get the Kc for the second rxn)and then figure the Kp? Is this r

A mixture containing 3.9 moles of NO and 0.88 mole of CO2 was allowed to react in a flask at a certain temp according to the equation:
NO(g)+CO2(g) f/r NO2(g)=CO(g)
At equilibrium, 0.11 mole of CO2 present. Calculate equilibrium constant, Kc.

1. Suppose the market can be described by the following three sources of systematic risk with associated risk premiums.
Factor Risk Premium
Industrial production (I) 7%
Interestrates ( R) 3
Consumer confidence ( C) 5
The return on a particular stock is generated according to the following equation: