The income elasticity of money demand is 1.00 and the interest elasticity of money demand is -0.10. Real income is expected to grow by 3.3% over the next year, and the real interest rate is expected to remain constant over the next year. The rate of inflation has been zero for several years. a. If the central bank wants zero inflation over the next year, what growth rate of the nominal money supply should it choose? % delta M = 3.3 (enter your response rounded to two decimal places). b. By how much will velocity change over the next year if the central bank follows the policy that achieves zero inflation? % delta V = (enter your response rounded to two decimal places).

In each of the cases below, assume division x has a product that can be sold either to outside customers or to division y of the same company for use in its production process. the managers of the divisions are evaluated based on their divisional profits. case a b division x: capacity in units 200,000 200,000 number of units being sold to outside customers 200,000 160,000 selling price per unit to outside customers $ 90 $ 75 variable costs per unit $ 70 $ 60 fixed costs per unit (based on capacity) $ 13 $ 8 division y: number of units needed for production 40,000 40,000 purchase price per unit now being paid to an outside supplier $ 86 $ 74 required: 1. refer to the data in case a above. assume in this case that $3 per unit in variable selling costs can be avoided on intracompany sales. a. what is the lowest acceptable transfer price from the perspective of the selling division? b. what is the highest acceptable transfer price from the perspective of the buying division? c. what is the range of acceptable transfer prices (if any) between the two divisions? if the managers are free to negotiate and make decisions on their own, will a transfer probably take place?