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Suppose that the Fed would like to cure mtlatlon thru a contractionary monetary policy by reducing money supply from 1040 to 940 . 1. Discuss

Suppose that the Fed would like to cure mtlatlon thru a contractionary monetary policy by reducing money supply from 1040 to 940 . 1. Discuss what tools can the Fed use to do that 2. Find the new LM curve and Graph it 3. Find the new equilibrium of interest rate and the new equilibrium level of income Y using the IS curve derived in Problem 1 question# 1 . 4. Discuss the repercussion of the Fed policy on the different economic variables such as consumption ,Investment, demand for money ,ect

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