If there is a leftward shift of the money demand curve,which of the following should the Fed do if it wants to keep the price level stable?
A) Lower its interest rate target
B) Sell bonds in the open market
C) Wait,since the price level does not usually change when the money demand curve shifts
D) Raise its interest rate target
E) Buy bonds in the open market.

Question

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The Answer of If there is a leftward shift of the money demand curve,which of the following should the Fed do if it wants to keep the price level stable?
A) Lower its interest rate target
B) Sell bonds in the open market
C) Wait,since the price level does not usually change when the money demand curve shifts
D) Raise its interest rate target
E) Buy bonds in the open market.

If There Is a Leftward Shift of the Money Demand