A Decrease in the Money Supply

question 245

Multiple Choice

A decrease in the money supply:

• A) raises the interest rate, causing an increase in investment and an increase in GDP.
• B) lowers the interest rate, causing an increase in investment and an increase in GDP.
• C) raises the interest rate, causing a decrease in investment and a decrease in GDP.
• D) lowers the interest rate, causing a decrease in investment and an increase in GDP.
• E) lowers the interest rate, causing a decrease in investment and a decrease in GDP.

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