Use the Following Figure to Nswer the Question

question 11

Multiple Choice

Use the following figure to nswer the question :
-In the figure above,illustrates the effect of an increased rate of money supply growth at time period 0. From the figure,one can conclude that the

• A)Fisher effect is dominated by the liquidity effect and interest rates adjust slowly to changes in expected inflation.
• B)liquidity effect is dominated by the Fisher effect and interest rates adjust slowly to changes in expected inflation.
• C)liquidity effect is dominated by the Fisher effect and interest rates adjust quickly to changes in expected inflation.
• D)Fisher effect is smaller than the expected inflation effect and interest rates adjust quickly to changes in expected inflation.

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Definitions:

Adopted Pet

Refers to an animal that has been taken into a home from a shelter or rescue organization to be a family pet.

Female

Referring to the sex of an organism or individual having characteristics associated biologically and genetically with females, often in contrast to males.

Male

Refers to the biological sex that produces small, mobile gametes, typically associated with XY chromosomes in many species.

Combinations

The selection of items from a collection, such that the order of selection does not matter, often used in probability and statistics.