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Question 13 (6 points) The graph shows the demand curve for reserves in the market for bank reserves. If the quantity of reserves supplied is

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Question 13 (6 points) The graph shows the demand curve for reserves in the market for bank reserves. If the quantity of reserves supplied is $40 billion and the Fed wants to set the federal funds rate at 1 percent a year, by how much should the Fed need to increase or decrease the quantity of reserves supplied? (For example: If the Fed should increase the quantity of reserves supplied by $20 billion, write 20. If the Fed should decrease the quantity of reserves supplied by $20 billion, write -20. If the Fed should not do anything, write 0.) Federal funds rate (percent per year) 8 6- 8 5- 3 MacBook Pro 2

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