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.Suppose that banks launch an aggressive marketing campaign to get everyone to use debit c

.Suppose that banks launch an aggressive marketing campaign to get everyone to use debit c

.Suppose that banks launch an aggressive marketing campaign to get everyone to use debit cards for every conceivable transaction. They offer prizes to new debit card holders and introduce a charge on using a credit card. How would the demand for money and the nominal interest rate change?

4.Draw a graph of the money market to illustrate equilibrium in the short run. If the growth rate of the quantity of money increases, explain what happens to the real interest rate and the nominal interest rate in the short run.

 

Abhinav 05-Dec-2019

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