Which One of the Following Statements Is the MOST Accurate

question 37

Multiple Choice

Which one of the following statements is the MOST accurate?

• A) A decrease in the money supply lowers the interest rate while an increase in the money supply raises the interest rate, given the price level and output.
• B) An increase in the money supply lowers the interest rate while a fall in the money supply raises the interest rate, given the price level.
• C) An increase in the money supply lowers the interest rate while a fall in the money supply raises the interest rate, given the output level.
• D) An increase in the money supply lowers the interest rate while a fall in the money supply raises the interest rate, given the price level and output.
• E) An increase in the money supply does not usually affect the interest rate.