If the Japanese price level decreases by 2% relative to the price level in the United States, what does the theory of purchasing power parity predict will happen to the value of the Japanese yen in terms of dollars, show the detail.

  If the Indian government unexpectedly announces that it will be imposing higher tariffs on foreign goods one year from now, what will happen to the value of the Indian rupee today, why?  

 What three motives for holding money did Keynes consider in his liquidity preference theory of the demand for real money balances, briefly explain.  

  During the time horizon from 2018 to 2020: Suppose the money supply M has been growing at 10% per year, and nominal GDP, PY, has been growing at 20% per year. In 2018 we have M equals to 200 and PY equals to 2000 (in billions of dollars). Calculate the velocity for each year. At what rate is the velocity growing?