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On the graph, draw the supply of money curve if the Fed's target interest rate is 5 percent a year. Label it MS0. Now, draw
On the graph, draw the supply of money curve if the Fed's target interest rate is 5 percent a year. Label it MS0. Now, draw a curve to show the effect of an increase in real GDP. Label it. Suppose that the Fed responds by raising the interest rate target to 6 percent a year, draw the new supply of money curve. Label it MS1
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