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Exhibit 16-4 Aggregate Demand and Supply Model in Exhibit

Question 145

Multiple Choice

Exhibit 16-4 Aggregate demand and supply model Exhibit 16-4 Aggregate demand and supply model In Exhibit 16-4, which one of the following actions could the Fed use to shift the AD curve from AD<sub>3</sub> to AD<sub>2</sub>? A) Lower the legal reserve requirement. B) Lower the discount rate. C) Lower the federal funds rate. D) Raise the discount rate. E) Buy government securities. In Exhibit 16-4, which one of the following actions could the Fed use to shift the AD curve from AD3 to AD2?


A) Lower the legal reserve requirement.
B) Lower the discount rate.
C) Lower the federal funds rate.
D) Raise the discount rate.
E) Buy government securities.

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