Quantity theory of money.
There is one good in the economy: corn.
V= Constant Y= 800 bushels of corn.. In 2008 Money Supply =$2000
In 2009 Fed increases MS by 5% to $2100..
A) Compute 2009 values of nominal GDP and P. Compute inflation
rate for 2008-2009.
B) Suppose tech progress increases Y to 824 in 2009. Compute
2008-2009 inflation rate.
**Please if you answer provide explanations. My teacher gave us
the answers but I really do not understand how she got them or