Using the Walras Relationship, Explain the Impact of an Excess

Essay

Using the Walras relationship, explain the impact of an excess supply of money on other asset prices (the prices of other ways of holding wealth) in China. Be specific about which assets you are referring to.
Consider the following table with two assets: Money and All Other Assets (e.g., real estate, stocks and bonds).
$\begin{array}{|l|l|l|l|}\hline & \text { Money } & \text { All Other Assets } & \text { Total Wealth } \\& & (\mathrm{AOA}) & \\\hline \text { Demand } & 800 & 500 & 1300 \\\hline \text { Supply } & 1000 & 300 & 1300 \\\hline \text { Excess DD (+) or } & -200 & +200 &0 \\\mathrm{SS}(-)\\\hline\end{array}$