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When the Fed Decreases the Money Supply

Question 143

Multiple Choice

When the Fed decreases the money supply:


A) aggregate demand and aggregate supply both increase.
B) aggregate demand increases,which leads to movement along the short-run aggregate supply curve.
C) aggregate demand decreases,which leads to movement along the short-run aggregate supply curve.
D) aggregate supply increases,which leads to movement along the aggregate demand curve.
E) aggregate supply decreases,which leads to movement along the aggregate demand curve.

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