If the Federal Reserve engages in contractionary monetary policy: What will be the effect on money demand,
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Question:
If the Federal Reserve engages in contractionary monetary policy:
- What will be the effect on money demand, money supply, and interest rates? Please explain.
- What will be the effect on planned investment, AE, and GDP? Please explain
- In the short-run: What will be the effect on AD and SRAS? What will be the effect on the average price level?
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