Which of the following is a monetary policy intended to rein in inflation?
A) Increase the money supply to shift the aggregate demand curve rightward
B) Reduce interest rates to increase investment spending
C) Reduce the interest paid on banks' reserves
D) Decrease the money supply to shift the aggregate demand curve leftward

Question

Quizplus · Accepted Answer

Decreasing the money supply will decrease the aggregate demand for goods and services in the economy, which can help to slow down inflationary pressures. This is because when there is less money available for spending, consumers and businesses will be less able to bid up prices.

Which of the Following Is a Monetary Policy Intended to Rein