Exhibit 16-2 Money market demand and supply curves 
Beginning from an equilibrium at E1 in Exhibit 16-2, an increase in the money supply from $400 billion to $600 billion causes people to:
A) sell bonds and drive the price of bonds down.
B) buy bonds and drive the price of bonds up.
C) buy bonds and drive the price of bonds down.
D) sell bonds and drive the price of bonds up.
Correct Answer:
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