Figure 14-1

question 100

Multiple Choice

Figure 14-1
-Refer to the Figure 14-1.How would an increase in the money supply move the economy in the long run?

• A) from C to A
• B) from C to B
• C) from C to A to C again
• D) from C to D

---

Definitions:

Consumer Equilibrium

A state in which a consumer has allocated their income in a way that maximizes their utility, given their budget constraint.

MU/P Ratio

The Marginal Utility to Price ratio, used in economic analysis to evaluate the satisfaction received from consuming an additional unit of a good relative to its cost.

Marginal Utility

The additional satisfaction or benefit received from consuming one more unit of a good or service.