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Assume the Fed decided to decrease money supply. Using the IS/LM model along with the aggregate demand, aggregate supply, verbally explain what will happen to
Assume the Fed decided to decrease money supply. Using the IS/LM model along with the aggregate demand, aggregate supply, verbally explain what will happen to the Price level, Output, Consumption, Unemployment and interest rate in both the short run and long run.
Verbally state the movements and shifts in the curves. Make sure to explain how the economy transitions form the short run to the long run.
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