Friday

January 30, 2015

January 30, 2015

Posted by **Jayda** on Monday, November 27, 2006 at 2:44am.

a)What is the inflation rate?

b)What is the growth rate of money?

c)What is the growth rate of nominal GDP?

Take a shot. What do you think.

a) 3%

b) 2%

c) 7%

Is this correct?

Im guessing that you are just guessing.

a) The difference between nominal and real interest is the rate of inflation. Ergo, a) is 5%.

c) The difference between nominal and real growth rates is the rate of inflation. Ergo in this simplistic example, c) is 8% (BTW, I would count you right if you said 8.15%)

b) MV=PQ and PQ is nominal GNP. Since V is constant and PQ is growing by 8%, M must also be growing by 8%. b) is 8%

**Answer this Question**

**Related Questions**

ECON--HELP!?!?! - 1. In the Country of Wiknam, the velocity of money is constant...

ECON-HELP!! - 1. In the Country of Wiknam, the velocity of money is constant. ...

ECON - CAN ANYONE PLEASE HELP// 1. In the Country of Wiknam, the velocity of ...

econ-HELP! - CAN ANYONE PLEASE HELP// 1. In the Country of Wiknam, the velocity...

ECON-can anyone help - CAN ANYONE PLEASE HELP// 1. In the Country of Wiknam, the...

ECON--HELP!!! - I am at work and am sending this on my cell phone.. BEFORE MY ...

Economics - The nominal interest rate is 12 percent per year in Canada and 8 ...

Economics - The formula given was: (real rate of interest) = (nominal rate of ...

Economics - The nominal interest rate is 12 percent per year in Canada and 8 ...

Math - You want to have 1.5 million in real dollars in an account when you ...