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 .
Question 1: (a) Describe how asymmetric information influences the price system and resource allocation. Provide examples to support your answer. (b) Managerial decision-ma
Features of this system The mixed economy includes elements of both market and planned economies. The government operates and controls the public sector, which typically cons
Disadvantages of Perfect Competition There is a great deal of duplication of production and distribution facilities amongst firms and consequent waste. Economies of sc
Suppose that, in their divorce settlement, Ashton Kutcher offers Demi Moore $16 million spread evenly over 8 years (with the 1st payment upfront and the 2nd payment at the end of y
What is the Permanent Income Hypothesis? What is the theory's potential relevance for assessing the effects of temporary tax cuts for the purpose of fiscal stimulus? If you were
PUBLIC SECTOR BORROWING REQUIREMENT (PSBR) Public Sector Borrowing Requirement (PSBR) is the amount which the government needs to borrow in any one year to finance an excess e
points and its explanation
gap between economic theory and business practice
electron control,inc.,cells voltage regulators to other manufacturers , who then customize and distribute the products to quality assurance labs for their sensitive test equipment.
Q. What is Labour Requirements on the production capacity? Labour Requirements: Spending on labour is one of the most vital elements of cost of production. Dependable and cor
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