help please!

Homework (Ch 17) MS Money Demand VALUE OF MONEY MS, QUANTITY OF MONEY (Billions of dollars) According to your graph, the equilibrium value of money is 1.25 7 , therefore the equilibrium price level is Now. suppose that the Fed reduces the money supply from the initial level of $3.5 billion to $2 billion. In order to reduce the money supply, the Fed can use open market operations to the public. Use the purple line (diamond symbol) to plot the new money supply ( MS). Immediately after the Fed changes the money supply from its initial equilibrium level, the quantity of money supplied is than the quantity of money demanded at the initial equilibrium. This contraction in the money supply people's demand for goods and services. In the long run, since the economy's ability to produce goods and services has not changed, the prices of goods and services will and the value of money will