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Free zone in central bank

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Suppose the Free Zone (the site presented in the problem 6), the aggregate supply curve is short term OAC and potential GDP increases 350 000 million.
a-what would happen if the Free Zone in central bank lowered the federal funds rate and buy securities on the open market?
b-recommends that the central bank sua or lower the federal funds rate? why?
c-Recommends that the central bank will raise or lower the federal funds rate? Why?    

Reference no: EM13150699

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