Refer to Figure 12.5 for the following question.
Figure 12.5

-Refer to Figure 12.5. In this figure, suppose the economy in Year 1 is at point A and expected in Year 2 to be at point B. Which of the following policies could the Reserve Bank of Australia use to move the economy to point C?

Question

Refer to Figure 12.5 for the following question.
Figure 12.5
 
-Refer to Figure 12.5. In this figure, suppose the economy in Year 1 is at point A and expected in Year 2 to be at point B. Which of the following policies could the Reserve Bank of Australia use to move the economy to point C?

Quizplus · Accepted Answer

Selling financial securities would decrease the money supply, leading to an increase in interest rates, which would discourage borrowing and spending, thus shifting the economy from point B to point C.

Refer to Figure 12.5 for the Following Question