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MArishka [77]
1 year ago
13

In an economy where the money supply and aggregate demand have been decreased by the central bank, you know that the central ban

k is using?
Business
1 answer:
natima [27]1 year ago
4 0

In an economy where the money supply and aggregate demand have been decreased by the central bank, you know that the central bank is using a contractionary monetary policy.

In an economy, changes in the money supply leads to changes in aggregate demand. An increase in the money supply increases aggregate demand and a decrease in the money supply decreases aggregate demand.

When a central bank takes action in order to decrease the money supply and increase the interest rate, it is following a contractionary monetary policy. Thus, the central bank requires Southern to hold 10% of deposits as reserves.

Hence, the decrease in the money supply reduces income and raises the interest rate.

To learn more about aggregate demand here:

brainly.com/question/24319248

#SPJ4

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Answer:

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Shelton Enterprises is expecting tremendous growth from its newest boutique store. Next year the store is expected to bring in n
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B. $6,448,519

Explanation:

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