(15)
Answer (Choose 1 answer)
(17947) Refer to Figure 30-2. At the end of 2007 the relevant money-demand curve was the one labeled MD2.At the end of 2008 the relevant money-demand curve was the one labeled MD1. Assuming the economy is always in equilibrium, what was the economy's approximate inflation rate for 2008?
A. -43 percent
B. -57 percent
C. 57 percent
D. 75 percent
1.125
1
Figure 30-2. On the graph, MS represents the money supply and MD represents money demand. The usual quantities are measured along the axes.
MS
0.875
0.75
0.625
0.5
0.375+
0.25
MD1
0.125
MD2
5,000
