The interest-rate-based transmission mechanism involves an initial change in monetary policy causing a change in excess reserves, a multiple change in the money supply, a change in the interest rate, a change in investment, and finally a multiple change in real GDP. Explain the required increases or decreases that must occur in the transmission mechanism in order to yield a desired decrease in real GDP The required change in monetary policy would be an open market . This initial policy action would bring about a in excess reserves, a multiple in the money supply, in the interest rate (and corresponding in bond prices), and in investment. The in investment would induce the Bank of Canada's desired multiple decrease in real GDP