Shifts in the money supply function and AD function reflect changes in monetary policy.

Question

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Shifts in the money supply function reflect changes in monetary policy because the central bank controls the money supply by setting interest rates and conducting open market operations. Similarly, shifts in the Aggregate Demand (AD) function can also reflect changes in monetary policy, as adjustments in interest rates influence spending and investment decisions, thereby affecting the overall demand in the economy.

Shifts in the Money Supply Function and AD Function Reflect