The demand for money is given by Md = $Y (0.3 - i),where $Y = 120 and the supply of money is $30.
a.What is the equilibrium interest rate?
b.If the central bank wants to decrease i by 2%,at what level should it set the supply of money?

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The Answer of The demand for money is given by Md = $Y (0.3 - i),where $Y = 120 and the supply of money is $30.
a.What is the equilibrium interest rate?
b.If the central bank wants to decrease i by 2%,at what level should it set the supply of money?

The Demand for Money Is Given by Md = $Y