When There Is an Excess Demand for Money Balances,monetary Equilibrium

question 53

Multiple Choice

When there is an excess demand for money balances,monetary equilibrium is established by a process that involves
1) movement down the money demand function;
2) interest rates falling;
3) the price of bonds falling.

• A)1 only
• B)2 only
• C)3 only
• D)1 and 2
• E)2 and 3

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