AP Macroeconomics Unit 4 - Part 3

Money Market Graph

    Axis
          Y- intrest rate
          X-Quantity of money
    Slope Downward
          Price is low = demand is high
          Price is High= Demand is high
   Suply of money is vertical, fixed by the FED, tied to the interest rate
   When you increase demand you put upward pressure on interest rates
    
Quantity or interest rates, Fed tries to stabilize your interests rates, can increase the money supply.