Suppose an improvement in online banking technology makes it less costly to conduct financial trans- actions. Notice this is an improvement in the technology for financial services, not more generally for the production of final goods and services. Describe and illustrate the general equilibrium effects on the economy. Be sure to describe and illustrate the impact on the market for money in your answer.

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An improvement in online banking technology that reduces the cost of financial transactions can have several general equilibrium effects on the econom... View the full answer