Figure 34-5.On the figure,MS represents money supply and MD represents money demand. -Refer to Figure 34-5.A shift of the money-demand curve from MD₂ to MD₁ is consistent with which of the following sets of events? A)The government cuts taxes,resulting in an increase in people's incomes. B)The government reduces government spending,resulting in a decrease in people's incomes. C)The Federal Reserve increases the supply of money,which decreases the interest rate. D)All of the above are correct.

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The Answer of Figure 34-5.On the figure,MS represents money supply and MD represents money demand. -Refer to Figure 34-5.A shift of the money-demand curve from MD₂ to MD₁ is consistent with which of the following sets of events? A)The government cuts taxes,resulting in an increase in people's incomes. B)The government reduces government spending,resulting in a decrease in people's incomes. C)The Federal Reserve increases the supply of money,which decreases the interest rate. D)All of the above are correct.