INFLATION RATE (m) 1 LRAS SRAS 4% 7 AGGREGATE DEMAND 2% 6% 8% REAL GDP GROWTH RATE Suppose an increase in the money supply growth rate shifts the AD curve as shown above. When the economy returns to lor equilibrium, the new inflation rate will be Choose one 150 a. 2%. b. 4%. time when the banking and 8.3/How a Central Bank E the end of this section, you will be able Explain the reason for open marke Evaluate reserve requirements and d nterpret and show bank activity through baler d Reserve's most important function is en gives Congress the power Federal Reserve. C o 80°F Clear c. 6%. d. 8%. Oe. None of the above. Q Search 1023

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