In the short run, monetary policy can
A) raise the cash rate and shift the aggregate demand curve leftward.
B) lower the cash rate, thereby increasing the supply of loanable funds, and lowering the exchange rate.
C) raise the cash rate, thereby decreasing the supply of loanable funds, raising the real interest rate, and decreasing investment.
D) All of the above answers are correct.
Correct Answer:
Verified
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A)both
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