If the Fed thinks there has been a positive wealth effect, what sort of change in monetary policy would it be likely to make? What happens if it does not make the change? Illustrate both cases graphically.

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The Answer of If the Fed thinks there has been a positive wealth effect, what sort of change in monetary policy would it be likely to make? What happens if it does not make the change? Illustrate both cases graphically.

If the Fed Thinks There Has Been a Positive Wealth