A decrease in the quantity of money supplied shifts the money supply curve to the ________,and the LM curve to the ________,everything else held constant.
A)right;left
B)right;right
C)left;left
D)left;right

Question

Quizplus · Accepted Answer

A decrease in the quantity of money supplied means there is less money available in the economy, which shifts the money supply curve to the left. This would lead to an increase in the interest rate, which would in turn reduce investment and shift the LM curve to the left as well.

A Decrease in the Quantity of Money Supplied Shifts the Money