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13 Dec 2019
If there is an autonomous increase in spending (a rightward shift in the aggregate demand curve) and the Fed wishes to hold real income constant, then the Fed would:
none of the above.
hold the money supply constant
decrease the money supply yielding a leftward shift in the aggregate demand curve.
ncrease the money supply yielding a rightward shift in the aggregate demand curve.
If there is an autonomous increase in spending (a rightward shift in the aggregate demand curve) and the Fed wishes to hold real income constant, then the Fed would:
none of the above.
hold the money supply constant
decrease the money supply yielding a leftward shift in the aggregate demand curve.
ncrease the money supply yielding a rightward shift in the aggregate demand curve.
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