In the Long Run, What Effect Does an Increase in the Money

question 55

Multiple Choice

In the long run, what effect does an increase in the money supply have on prices and unemployment?

• A)It leaves prices and unemployment unchanged.
• B)It raises prices and unemployment.
• C)It raises prices and leaves unemployment unchanged.
• D)It leaves prices unchanged and reduces unemployment.

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Definitions:

Nonlinear

Describes relationships in data or equations where there is not a straight-line or proportional association between variables.

Spread

A statistical term referring to the range or distribution of a set of values.

Age

The length of time that a person or object has existed or the period since an object’s creation or a person’s birth.

Price

The amount of money required to purchase something or the value that is ascribed to a good or service.