Figure 4-1 -Employing Figure Above, If Y Increases by 3000 and the 3000

question 144

Multiple Choice

Figure 4-1
-Employing Figure above, if Y increases by 3000 and the interest rate is fixed at 5% then the sensitivity of real money balances to changes in real income is

• A) 0.67.
• B) 0.33.
• C) -0.67.
• D) -0.33.

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