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In the figure, when the money supply increased from MS, to MS2, the equilibrium interest rate fell from 4% to 3%. Why? OA. Initially, firms
In the figure, when the money supply increased from MS, to MS2, the equilibrium interest rate fell from 4% to 3%. Why? OA. Initially, firms hold more money than they want relative to other financial assets. B. Increased demand for Treasury securities drives up their prices. OC. Increased demand for Treasury securities drives down their interest rate. D. All of the above
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Intermediate Microeconomics and Its Application
Authors: walter nicholson, christopher snyder
11th edition
9781111784300, 324599102, 1111784302, 978-0324599107
