the basic functions of money
Order ID: 89JHGSJE83839 Style: APA/MLA/Harvard/Chicago Pages: 5-10 Instructions:
Question Description
(Directions: Answer questions neatly & in order & on separate sheet or sheets of paper.)1. What are the basic functions of money, i.e., what services does money provide?
2. In the liquidity demand for money function, what does Dt represent? What determines the Dt demand for money? What does Da represent and what determines it? In words, how is the equilibrium rate of interest determined according to the analysis presented in class and your textbook?
3. Given the following reserve ratio, find maximum (potential) amount of (checkable deposit) money the private banking system can create, with a deposit into checking accounts of $200 million. (Assume that banks are all loaned-up).
a. 5%
b. What two assumptions were made in your above calculations?4. Assume the economy appears to be slowing & fears of recession are on the rise. Starting with the money market diagram, with words & diagrams (including the aforementioned MMD, the investment demand & AS/AD diagrams), work through the (monetary) transmission mechanism, given the appropriate type of monetary policy.
5. What is the difference between the Classical and (simple) Keynesian aggregate supply curves? Draw a graph of each.Explain why the respective curves look the way they do.
****SHORT ANSWER HINTS
1. Breakdown the liquidity preference demand for money function (& why are bond prices & interest rates inversely related)
2. See question 4 above
3. Compare & contrast the 3 schools of modern macroeconomic thought discussed in class & the text (this includes “Keynesianism”, Monetarism & Rational Expectations Theory)
4. there is no number 4
RUBRIC
Excellent Quality
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The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
Literature Support
91-84 points
The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
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58-53 points
Content is well-organized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met.
Average Score
50-85%
40-38 points
More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided.
83-76 points
Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration.
52-49 points
Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met.
Poor Quality
0-45%
37-1 points
The background and/or significance are missing. No search history information is provided.
75-1 points
Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration.
48-1 points
There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met
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the basic functions of money