Exhibit 16-4 Aggregate Demand and Supply Model

question 32

Multiple Choice

Exhibit 16-4 Aggregate demand and supply model

In Exhibit 16-4, which one of the following actions could the Fed use to shift the AD curve from AD₁ to AD₂?

• A) raise the legal reserve requirement
• B) lower the discount rate
• C) lower the federal funds rate
• D) sell government securities

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