In the Aggregate Demand-Aggregate Supply Model, the Short-Run Effects of an Unanticipated

question 124

Multiple Choice

In the aggregate demand-aggregate supply model, the short-run effects of an unanticipated increase in the money supply will be

• A) lower real interest rates and an increase in aggregate demand.
• B) higher real interest rates and an increase in aggregate demand.
• C) lower real interest rates and a reduction in aggregate demand.
• D) higher real interest rates and a reduction in aggregate demand.

---

Definitions:

Impossible Events

Scenarios or occurrences that defy logical explanation, physical laws, or real-world possibilities.

Executive Function

Executive Function encompasses the mental skills essential for planning, focus, remembering instructions, and multitasking; it manages thoughts, actions, and emotions.

Association

A cognitive connection between ideas, feelings, or memories.

Motor Areas

Regions of the brain responsible for the planning, control, and execution of voluntary movements.