Advises country on monetary and fiscal policy matters

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Reference no: EM131161656

You have been hired by a consulting firm that advises a country on monetary and fiscal policy matters. Your assignment is to develop monetary policy options for the country. The country explicitly states that its long-run inflation target is 2%. If you know that the country's velocity of mony growth is 2% and the average output growth rate of the country is 3%, what would you tell the country to do to ensure that it maintains its inflation target? Show all your calculations.

Reference no: EM131161656

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