Answer to Question #221526 in Macroeconomics for Himanshu

Question #221526

Use the following information (in rupees):

Income (Y) = 1,00,000

Nominal Money Supply (M) = 80,000

Price Level (P) = 20

Calculate the money growth rate required to finance the budget deficit of Rs.10,000 in an

economy.

Expert's answer

Money Growth rate =2.7%

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