In the Long Run, an Increase in the Money Supply

question 159

Multiple Choice

In the long run, an increase in the money supply:

• A)will increase real GDP and the price level.
• B)causes people to hold onto large sums of money.
• C)results in no change in real GDP.
• D)encourages people to save more money.

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Definitions:

Fine Imposed

A monetary penalty levied by an authority on a person or organization as punishment for a violation or wrongdoing.

Cockatoos

A group of parrot species known for their distinctive crests and variety of colors, native to Australia, Indonesia, and the surrounding areas.

Smuggled

Smuggled goods are items that are illegally transported across borders without authorization or without paying required tariffs and taxes.

Transit

The act or process of moving people or goods from one place to another, often referring to public transportation systems.