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Monetary Policy is able to affect (or influence) Aggregate Demand (AD) through expansionary or contractionary monetary policy.Monetary policies are set and implemented through the Federal

Monetary Policy is able to affect (or influence) Aggregate Demand (AD) through expansionary or contractionary monetary policy.Monetary policies are set and implemented through the Federal Reserve System.Assume either anexpansionaryorcontractionarypolicy is required and describe the actions that may be taken by the Federal Reserve to implement the policy and its intended affect on AD.

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