Given- income 100000 ,nominal money supply 80000, price level 20.calculate the money growth rate required to finance the budget efficient of rupees 10000 in an economy?
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AM/M + AV/V = AP/P + AGDP/GDP. AM/M is the growth rate of the money supply, ~W/V is the growth rate of velocity, AP/P is the growth rate of the GDP deflator (inflation rate), and AGDP/GDP is the growth rate of real gross domestic product. If velocity is constant, its growth rate is zero.
use that formula you will get your answer
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