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There are three moves the US Federal Bank can take to contract the economy . Demonstrate what happens to the price of reserves (x axis)
There are three moves the US Federal Bank can take to contract the economy . Demonstrate what happens to the price of reserves (x axis) and quantity of reserves (y axis) in graphs.
Note: price of reserve refers to the rate at which the bank is buying and selling.
1. Changing the requirements
2. Lending through a Discount Window
3. Engaging in Market Operations
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