Using the Liquidity-Preference Model, When the Federal Reserve Decreases the Money

question 152

Multiple Choice

Using the liquidity-preference model, when the Federal Reserve decreases the money supply,

• A)the equilibrium interest rate increases.
• B)the aggregate-demand curve shifts to the right.
• C)the quantity of goods and services demanded is unchanged for a given price level.
• D)the short-run aggregate-supply curve shifts to the left.

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