In the Short Run, Monetary Policy Can

question 70

Multiple Choice

In the short run, monetary policy can

• A) raise the federal funds rate, thereby decreasing the supply of loanable funds, raising the real interest rate, and decreasing investment.
• B) lower the federal funds rate, thereby increasing the supply of loanable funds, and lowering the exchange rate.
• C) raise the federal funds rate and shift the aggregate demand curve leftward.
• D) All of the above answers are correct.

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