Use a graph to explain why the Fed cannot target both an interest rate and a monetary aggregate at the same time, assuming that there is a drop in aggregate deman Assume that the Fed is targeting the...

Use a graph to explain why the Fed cannot target both an interest rate and a monetary aggregate at the same time, assuming that there is a drop in aggregate deman

Assume that the Fed is targeting the money supply and the demand for money falls. Explain why interest rates will fall.