Economics assignment monetary policy

1. a. the total demand for final goods and services in an

economy at a given time
b.The Federal Reserve Board allows money supply to
increase by more than what a central bank wants.
2. a. A rise in the rate of interest means that the cost
of borrowing will increase, and may discourage
consumers from borrowing
b. Because when the interest rate is high, banks make
more money and thus can lend the money.