When Price Levels Rise, the Quantity of Nominal Money Demanded

question 152

Multiple Choice

When price levels rise, the quantity of nominal money demanded will ________ and the quantity of real money demanded will ________.

• A) increase; stay the same
• B) increase; increase
• C) increase; decrease
• D) decrease; increase

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Definitions:

Articles Of Confederation

The first written constitution of the United States, ratified in 1781, which outlined a national government with limited powers and was later replaced by the U.S. Constitution in 1789.

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A mountain range in eastern North America extending from Canada to Alabama, offering significant biodiversity and recreational activities.

Navigation Rights

Legal rights or privileges concerning the passage of ships or boats through specific waterways, often key to trade, military, and transportation activities.

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The rate at which the general level of prices for goods and services is rising, eroding purchasing power, typically measured as an annual percentage increase.