A Decrease in Interest Rates by the Fed Based on a Given

question 34

Multiple Choice

A decrease in interest rates by the Fed based on a given and unchanged policy reaction function represents a ________ the aggregate demand curve, and lower interest rates resulting from a downward shift in the Fed's policy reaction function represents a ________ the aggregate demand curve.

• A)shift left of; movement up
• B)shift left of; shift right of
• C)movement up; movement down
• D)movement down; shift right of

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