Drop down options: 1. Increase/decrease 2.money demand/money supply 3.more/less

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Drop down options: 1. Increase/decrease 2.money demand/money supply 3.more/less 4.increase/decrease 5.must raise the interest they pay to / can issue bonds at a lower interest rates and stil... ing Pea." CengageBrain. My Home Suggested Sites. e) web Ske Gallery 3. Theeffect of changes in the money supply The following diagram represents the money market in the United States, which is currently in equilibrium, as indicated by the grey star Money Supply 6.0 5.5 New Curve Money Demand 5 0 45 New Equilibrium 3.5 3.0 2.5 2.0 06 07 08 09 10 1.1 12 1.3 QUANTITY OF MONEY (Trisions of dollars) Suppose the Federal Reserve (the Fed) announces that it is raising its target interest rate by 50 basis points, or 0.50% It would achieve this by

Explanation / Answer

1. decrease

2. money supply

3. less

4. increase

5. must raise the interest rate they pay

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