Question: Create a separate file and answer the following questions. When you are done attach the file below. a. Draw a graph of the market for
Create a separate file and answer the following questions. When you are done attach the file below. a. Draw a graph of the market for money. Label everything. b. What is the relationship between bond prices and interest rates? What happens to bond prices and interest rates when the Federal Reserve sells bonds? Draw a graph of the market for money, showing the changes that would occur if the Federal Reserve buys government securities. c. Explain why the money supply may not change as much as the Federal Reserve might desire. d. Say the Federal Reserve has increased the reserve requirements from 10% to 20%. What would happen to the money supply? Draw a graph that would show how this policy change would effect the changes in the money market that you graphed in part 'b' and explain
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