If RBI reduces money supply how will it effect to control inflation, prices and output?

we are trying to understand the cause of inflation and measures to reduce pricesIf RBI reduces money supply how will it effect to control inflation, prices and output?
I'm Canadian but I assume you mean the reserve bank of India.





Basically the bank does not actually reduce money supply. They raise interest rates. Raising interest rates slows the economy because it makes it more expensive for people to borrow as well as creating an incentive for them to save money instead of spending it. If there is less pending there is less demand and prices do not inflate.





A simple answer, don't know if you were looking for more complex IS/LM or even higher level models.