Problem
Suppose there is a decline in the demand for money. At each output level and interest rate the public now wants to hold lower real balances.
a. In the Keynesian case, what happens to equilibrium output and to prices?
b. In the classical case, what is the effect on output and on prices?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.