If the Fed conducts open-market sales, the money supply

Name: If the Fed conducts open-market sales, the money supply
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Question

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Open-market sales by the Fed involve selling government securities, which decreases the money supply as banks buy these securities and reduces the amount of money available for lending. This decrease in the money supply leads to higher interest rates, which in turn reduces investment and spending, causing the aggregate demand to shift to the left.

If the Fed Conducts Open-Market Sales, the Money Supply