Long-run without considering the feds open market operation

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Suppose that Apple Pay becomes extremely common and easy to use, so that people need to hold even less money in order to carry out transactions. Depict the effect this will have on Liquidity Preference market for money in the short-run. If the Federal Reserve wants the interest rate to remain unchanged, what kind of open market operations should they carry out? Depict the effect of this open market operation on Liquidity Preference market for money in the short-run. And then, depict the effect the introduction of Apple Pay will have on Liquidity Preference market for money in the long-run without considering the Fed's open market operation.

Reference no: EM131389280

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