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2. Describe expansionary and contractionary monetary policy and explain how these policies may affect aggregate demand. 
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4. Describe the "Open Market Operation". How does the Fed use this tool of monetary policy to control money supply?
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7. Describe the Liquidity Preference Model of Interest Rate and how this model demonstrates that the interest rate is determined by the supply and demand for money. 
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Expansionary and Contractionary Monetary Policy Expansionary Monetary Policy This is a strategy used by central banks to stimulate economic growth It ... View the full answer