Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Milton Friedman makes the demand for money a function of the real per capital permanent income. in this study the demand function for money is stated as;M/NPP= r( YP/NP) δ
Where:
M = nominal stock of money N = population Yp = permanent income Pp = permanent prices
This latter version of the demand for money is not as different from the first version as it appears to be because the concept of permanent income is broad enough to include several variables used in the earlier version of the demand for money . permanent income is affected by yield on securities and human and non human wealth holdings.
According to Milton Friedman, on the basis of empirical evidence the demand for nominal cash balance is represented by the following equation.
M =(0.00323)(Yp/N)1.81 (NPp)
Where all the variables have the same definition as stated above except ,Yp which stands for the real permanent income . in the above form the equation expresses that ( assuming population and permanent prices to be constant ) a 1 per cent increase in real permanent income increase the de4mand for the nominal cash balances by 1.81 per cent. In other words, the Friedman equation for the demand for money indicates that the real permanent income elasticity for the demand for nominal cash balances is 1.81. according to Friedman the causal relationship runs from change in the money supply to change in income .
1. Explain the industry and describe the general pattern of change of the particular market model. 2. Hypothesize the basic short-run and long-run behaviours of the model in the
The short run equilibrium of monopolist is displayed below in figure. Figure: Abnormal Profit under Monopoly AR is the average revenue curve, MR is marginal revenue cu
free trade promotes a mutually profitable regional division of labour greatly enhances the potential real national product ofall nations and makes possible higher standards of livi
A promoter decides to rent an arena for concert. Arena seats 20,000. Rental fee is 10,000. (This is a fixed cost.) The arena owner gets concessions and parking and pays all other e
manual problems solution of demand theory
Reasons for Shift in Demand Curve Shifts in a price-demand curve may occur due to the change in one or more of other determinants of demand. Consider, for illustration, decreas
Policies to cure Balance of Payment deficits The measures available to tackle balance of payments deficits include short term measures such as deflation, import controls, dev
game theory matrix dominant strategy
Price rise in future must not be expected - law of demand If the buyers of a commodity expect that its price will increase in future they raise its demand in response to an in
Question 1: (a) Describe the argument that market entry erodes profits in the long run. (b) Give some reasons and discuss possible strategies used for profits to persist eve
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd