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5. Answer the following questions by drawing the appropriate supply-and-demand diagrams. A An important way in which the central bank decreases the money supply is

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5. Answer the following questions by drawing the appropriate supply-and-demand diagrams. A An important way in which the central bank decreases the money supply is by selling bonds to the public. Using a supply-and- demand analysis for bonds, show what effect this action has on interest rates. B What effect will a sudden increase in the volatility of gold price have on interest rates

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