The following changes in economic conditions will affect either the aggregate demand curve or the aggregate supply curve. Match scenario to graph below that correctly illustrates the change. During a time of economic recession, the Federal Open Market Committee targets a lower federal funds rate by buying bonds on the open market. An increased use of credit cards causes consumers to hold less money. An increase in the price level means it takes more money to purchase the same basket of consumer goods. The Fed raises the interest rate paid on the excess reserves of banks to fend off inflation. The real incomes of consumers in the economy falls. A decrease in the discount rate signals that the Fed would like to see an increase in lending by banks
The following changes in economic conditions will affect either the aggregate demand curve or the
During a time of economic recession, the Federal Open Market Committee targets a lower federal funds rate by buying bonds on the open market.
An increased use of credit cards causes consumers to hold less money.
An increase in the price level means it takes more money to purchase the same basket of consumer goods.
The Fed raises the interest rate paid on the
The real incomes of consumers in the economy falls.
A decrease in the discount rate signals that the Fed would like to see an increase in lending by banks.
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