Supply of money the supply of money in an economy is controlled by its central bank for example fed in the us the fed may change the money supply by using open market operations or by changing reserve requirements demand and supply curve the demand and supply curve for money can be represented as follows. The money market is an economic model describing the supply and demand for money in a nation the demand curve for money illustrates the quantity of money demanded at a given interest rate notice . read supply and demand learning about money uploaded by jin yong how supply and demand determine price there are four basic laws that describe how supply and demand influence the price of a product 1 if the supply increases and demand stays the same the price will go down 2 if the supply decreases and demand stays. Changes in the price level and in real gdp also shift the money demand curve but these changes are the result of changes in aggregate demand or aggregate supply and are considered in more advanced courses in macroeconomics panel a shows that the money demand curve shifts to the left to d 2 we can see that the interest rate will fall to r 2
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