If a Central Bank Increases the Money Supply in Response

question 35

Multiple Choice

If a central bank increases the money supply in response to an adverse supply shock,then which of the following quantities moves closer to its pre-shock value as a result?

• A)both the price level and output
• B)the price level but not output
• C)output but not the price level
• D)neither output nor the price level

---

Definitions:

Consultant

A professional who provides expert advice in a particular area, such as business, education, law, regulatory compliance, finance, healthcare, and more.

Client

An entity that pays for or receives the services or advice of a professional or company.

Unfreezing

This is the first stage in the change process, making individuals or organizations aware of the need for change to overcome resistance.

Planned Change Process

A deliberate effort to improve an organization's effectiveness or to manage the impact of external changes through structured methods and strategies.