Make 2015 totally awesome. Take the Dummies challenge and you could win $1,000! Learn how.
Predict Changes in the Euro–Dollar Exchange Rate
Output and Exchange Rates
Intervention into Floating Exchange Rates

Establish Money Market Equilibrium

Step 1 of 3
Previous
Next Slideshow
Next Slideshow

The money market equilibrium, with the equilibrium real interest rate, r1, and the equilibrium quantity of real money, m1.

Remember the variables that can shift the money demand and supply curves. In the next example, a change in the country’s output and nominal money supply is applied to the money market. You can predict how the real interest rate and the real quantity of money in the money market change.

  • Add a Comment
  • Print
  • Share

Recommends

Promoted Stories From Around The Web

blog comments powered by Disqus
How to Determine Exchange Rates through Supply and Demand
The Roles of Speculators and Central Banks in Foreign Exchange Markets
The Role of Multinational Firms in Foreign Exchange Markets
Maintain the Internal Balance of the Metallic Standard
How to Work with the Purchasing Power Parity (PPP)
Advertisement