Contractionary monetary policy on the part of the Fed results in
A) an increase in the money supply, an increase in interest rates, and an increase in GDP.
B) a decrease in the money supply, an increase in interest rates, and a decrease in GDP.
C) an increase in the money supply, a decrease in interest rates, and an increase in GDP.
D) a decrease in the money supply, a decrease in interest rates, and a decrease in GDP.
Answer: B
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A. is the focus of most modern economic reasoning. B. answers the question "What ought to be?" C. predicts the consequences of alternative actions. D. answers the question "What is?"
Refer to the information provided in Figure 8.2 below to answer the question(s) that follow. 
Figure 8.2
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