question archive If the demand function for money is M i P = 0
If the demand function for money is M i P = 0
Subject:EconomicsPrice:2.89 Bought3
If the demand function for money is M i P = 0.2]L 200r, and if M! P increases by 100, then the [M curve for any
given interest rate shifts to the: 0 left by 500. 0 right by 500. 0 right by 100. 0 left by 100.
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The increase M/P shifts it to the right and the change to right = change in M/P divided by the coefficient of Y in the function
The shift =100/0.2=500
