After the increase in the price level, the quantity of money demanded at the initial interest rate of 9% will be _____ than the quantity of money supplied by the Fed at this interest rate. People will try to _____ their money holdings. In order to do so, people will _____bonds and other interest-bearing assets, and bond issuers will find that they______ interest rates until the money market reaches its new equilibrium at an interest rate of.

The change in the interest rate that you found previously will cause residential and business investment spending to ___, leading to ____in the quantity of output demanded in the economy.

7 . The theory of liquidity preferences and the downward sloping aggregate demand cures The following graph shows the money market in a hypothetical scanomy. The central bank in this scoreany In called the Fad. Assume that the Fed floor the quantity of manay supplied. Suppos the price level increases fram PO to 105. Shit the appropriate curve on the graph to show the impact of an Increase in the overal price lavel ar the market for money. Norway Supp's Masay Darnand Manny Supply INTEREST RATE [Parcont After the incross In the price krest, the quantity of money demanded at the infoal Interest rate of D'4 will be that the quantity of money supplied by the Fad at this interest rate People will try to their moray holdings. In order to do so, people will bonds and other interest-bearing mants, and band ismars will find that they nearest rabas until the money market reaches Is now equilibrium at an Interest rate at( The following prash shows the scoretry's aggregate demand curve. Show the impact of the Increase in the price level by moving the point wong the carve ar shifting the arms. 1 10 Aggreputs Darand PRICE LEVEL OUTPUT Allora of dollars) The change in the Interest rate that you found previously will cause residential and business Investment spending to in the quantity of output demanded in the scoreatry. Barre & Continua Continue without giving