Specialty Construction Group, Inc. added 7 new photos. We do things other than entrances as well! Retaining wall and sidewalk install at an office complex in Alpharetta. Complicated little site, but now the employees no longer have to wall in the street from the parking lot to the building.
The demand for money is a demand for real cash balances because people hold money for the purpose of buying goods and services. The higher the price level, the more money balances a person has to hold in order to purchase a given quantity of goods.
Suppose the Fed sets money growth, %M, equal to 6% per year, the annual real economic growth, %Y, is 3% and that the income elasticity of money demand is 2/3. Then our prediction for inflation is given by: = %M - (2/3)*%Y = 6% - (2/3)*3% = 4%.e build a link between money growth and inflation through our model of money market equilibrium. In money market equilibrium, real money supply is equal to real money demand: M/P = L d (Y, i).