Suppose the Money Demand Function Is M^D = P ×

question 25

Multiple Choice

Suppose the money demand function is M^D = P × [(0.25 × Y) ? (100 × i) ],
Where Y is expressed in billions of dollars and i is expressed in percentage points.If P = 2, Y = 5,000, and i = 5, then the real quantity of money demanded equals

• A)750.
• B)1,000.
• C)1,500.
• D)2,000.

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