If the Economy Is in General Equilibrium and the Fed

Multiple Choice

If the economy is in general equilibrium and the Fed reduces the money supply,

A) the previous equilibrium combination of output and the real interest rate represents a point of excess demand for money.
B) the previous equilibrium combination of output and the real interest rate represents a point where saving is greater than investment.
C) the LM curve shifts down and to the right.
D) the level of investment spending will increase.