Question: Take a look at Figure 16-6. Suppose that a multiple reduction in real GDP is the final outcome that the Fed desires in the last

Take a look at Figure 16-6. Suppose that a multiple reduction in real GDP is the final outcome that the Fed desires in the last box in the figure. Explain the required directions of effects-that is, increase or decrease-that must occur in the preceding boxes in the figure in order to yield this desired decrease in real GDP.

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