Explain change the demand for money by baumol-tobin model


Use the Baumol-Tobin model to explain how each of the following events would change the demand for money:

a. War breaks out, making it dangerous to travel.
b. The rate of inflation increases and is expected to continue to increase.
c. Most households begin to practice a "don't buy anything new" approach to shopping.

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Microeconomics: Explain change the demand for money by baumol-tobin model
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