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What would happen to the aggregate demand

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Reference no: EM131486900

In a simplified banking system in which all banks were subject to a 20% required reserve ratio with zero cash leakage, a $1 million open market purchased by the Fed would cause money supply to change by what amount? Also assume the economy is operating on the intermediate range of the aggregate supply curve, what would happen to the aggregate demand, CPI, GDP, employment.

Reference no: EM131486900

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