Consider monetary equilibrium and the monetary transmission mechanism.An exogenous decrease in the price level,with no change in the supply of money,will

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A decrease in the price level reduces the demand for money because less money is needed to purchase goods and services. This reduction in the demand for money leads to lower interest rates, which stimulates investment and consumption, thereby increasing aggregate expenditure and real GDP along the aggregate demand curve.

Consider Monetary Equilibrium and the Monetary Transmission Mechanism