Speculators and fully anticipated expansionary monetary policy problem

  • Thread starter Bipolarity
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  • #1
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Main Question or Discussion Point

http://img39.imageshack.us/img39/6386/macro2.jpg [Broken]

I don't understand the answer to this question.
The answer is
C
but I don't understand why.

BiP
 
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Answers and Replies

  • #3
Looks like C from the above power point. Of course that assumes an equal distribution of new money (the helicopter effect) which is not really the case as is pointed out in, “The case against the fed”.
 

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