If the Federal Reserve targets the money supply, and the money demand curve shifts to the left, then the Fed
A) cannot maintain the money supply target.
B) can maintain the money supply target, but at a lower interest rate.
C) can maintain the money supply target, but at a higher interest rate.
D) can maintain the money supply target with no change in the interest rate.
Answer: B
Economics
You might also like to view...
A contractionary fiscal policy
I. decreases a government budget deficit or increases a government budget surplus. II. includes tax cuts. III. may include discretionary cuts in transfer payments. A) I, II, and III B) I and II only C) I and III only D) II and III only
Economics
Explain why average total costs initially decrease and then increase as output increases
What will be an ideal response?
Economics