Using theory of liquidity preference explain what will happen in short run if the Fed decrease money supply? Will the interest rate increases? what is the interest rate vs aggregate outcome curve looks like

Using theory of liquidity preference explain what will happen in short run if the Fed decrease money supply? Will the interest rate increases? what is the interest rate vs aggregate outcome curve looks like

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter16: The Influence Of Monetary And Fiscal Policy On Aggregate Demand

Section16.1: How Monetary Policy Influences Aggregate Demand

Problem 1QQ

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