If the Demand for Money Decreases,a Constant Interest Rate Policy

question 78

Multiple Choice

If the demand for money decreases,a constant interest rate policy requires the Fed to

• A) consult with leaders in the financial markets to see whether it should introduce credit controls
• B) watch to see whether the investment spending decreases
• C) move quickly to prevent a recession
• D) decrease the supply of money
• E) decrease the interest rate.

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