Figure 34-2

question 174

Multiple Choice

Figure 34-2
(a) The Money Market
(b) The Aggregate Demand Curve
-Refer to Figure 34-2. If the money-supply curve MS on the left-hand graph were to shift to the left, this would

• A)not represent an action taken by the Federal Reserve.
• B)shift the AD curve to the right.
• C)create, until the interest rate adjusted, an excess supply of money at the interest rate that equilibrated the money market before the shift.
• D)shift the AD curve to the left.

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Definitions:

Dependent Variable

The variable in an experiment that is observed and measured to assess the effects of the independent variable, essentially the outcome of interest.

Scientific Method

A systematic, empirical approach to research, characterized by observation, hypothesis testing, experimentation, and conclusion.

Self-correcting

Capable of making necessary adjustments or corrections on one's own to maintain accuracy or functionality.

Analysis

A detailed examination of the elements or structure of something, typically as a basis for discussion or interpretation.