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28 Sep 2019
M1 money growth in the U.S. was about 16% in 2008, 7% in 2009 and 9% in 2010. Over the same period, the yield on 3-month T-bills fell from almost 3% to close to 0%. Given these high rates of money growth, why did the interest rates fall, rather than increase?
What does this say about the income, price level and expected inflation effects?
M1 money growth in the U.S. was about 16% in 2008, 7% in 2009 and 9% in 2010. Over the same period, the yield on 3-month T-bills fell from almost 3% to close to 0%. Given these high rates of money growth, why did the interest rates fall, rather than increase?
What does this say about the income, price level and expected inflation effects?
Insha FatimaLv10
28 Sep 2019
