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1) Describe the role of Depository Institutions (e.g. Commercial Banks) in the money creation process. 2) What kind of open market operations should the government

1) Describe the role of Depository Institutions (e.g. Commercial Banks) in the money creation process.

2) What kind of open market operations should the government follow in order to reduce aggregate demand in the economy? Describe the full process, including impact on GDP (with graphs)

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