The Money Supply Increased and the AD Curve Did Not

question 168

Multiple Choice

The money supply increased and the AD curve did not shift to the right.This is consistent with the

• A) Keynesian transmission mechanism when there is either a liquidity trap or interest-insensitive investment.
• B) monetarist transmission mechanism when there is interest-insensitive investment.
• C) Keynesian transmission mechanism when there is a liquidity trap.
• D) monetarist transmission mechanism when there is a liquidity trap.
• E) c and d

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