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    Principles of Macroeconomics Study Set 11
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    Exam 12: The Determination of Aggregate Output, the Price Level, and the Interest Rate
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    Show the Impact on the LM Curve of an Decrease
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Show the Impact on the LM Curve of an Decrease

Question 45

Question 45

Essay

Show the impact on the LM curve of an decrease in the money supply. Make sure to draw the IS curve and illustrate the impact on the equilibrium interest rate and aggregate output.

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