Monetarists assume that there is a powerful direct link between aggregate demand and

In the figure above, the expected inflation rate is

A) 6 percent. B) 0 percent. C) 2 percent. D) 8 percent. E) 4 percent.

Which of the following might lead banks to hold more reserves?

A. An increase in the demand for loanable funds B. A decrease in the legal reserve requirement C. Fear that customers will want to withdraw most of their deposits D. Fear that businesses may decide to borrow less to fund investments