In the Long Run, What Are the Effects of a Decrease

question 153

Multiple Choice

In the long run, what are the effects of a decrease in the rate of growth of the money supply?

• A) It will increase inflation and shift the short-run Phillips curve right.
• B) It will increase inflation and shift the short-run Phillips curve left.
• C) It will decrease inflation and shift the short-run Philips curve right.
• D) It will decrease inflation and shift the short-run Phillips curve left.

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Definitions:

Population Growth

The increase in the number of individuals in a population, often measured by the percentage increase per year.

Immigration

The movement of individuals from one country to another with the intent to reside or work there, either temporarily or permanently.

Implicit Costs

The opportunity costs of using resources that are not directly paid for or billed, but represent potential income lost.

Future Earnings

Projected income or profit that an individual, company, or asset is expected to generate in the future.