Exam 14: Money and the Economy

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The money supply falls from $1,200 billion to $1,160 billion.According to the simple quantity theory of money,the price level will decline by __________ percent.

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The change in the interest rate due to a change in the supply of loanable funds is referred to as the __________ effect.

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According to the simple quantity theory of money in the AD-AS framework,when the money supply decreases,the __________ curve shifts to the __________.

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