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The transmission mechanism between an open market purchase by the central bank and an increase in aggregate demand can break down if banks are unwilling
The transmission mechanism between an open market purchase
by the central bank and an increase in aggregate demand can
break down if
banks are unwilling to lend to private firms
money demand is totally interest inelastic
investment is very interest sensitive
bond prices increase too much
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Analysis Of Economic Data
Authors: Gary Koop
3rd Edition
0470713895, 9780470713891
