304L Homework 7 - Economics 304L: Principles of...

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Unformatted text preview: Economics 304L: Principles of Macroeconomics Spring 2010 Sadler Homework 7 Solutions The following problems refer to the “Problems and Applications” section at the end of Chapter 20 of Mankiw (pp. 469 ‐ 471). 1. 2. No. 1. No. 3 (Note that increases in the money supply increase AD. One way that they do so is by reducing interest rates, thereby increasing investment expenditures by firms. Decreases in the money supply reduce AD because interest rates increase and investment expenditure falls. We elaborate on this in Chapter 21). No. 5 3. 4. No. 6. The following problems refer to the “Problems and Applications” section at the end of Chapter 21 of Mankiw (pp. 495 ‐ 496). 5. 6. 7. 8. No. 2 No. 8 No. 9 No. 12 ...
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This note was uploaded on 12/17/2010 for the course ECO 33530 taught by Professor Sadler during the Spring '10 term at University of Texas at Austin.

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