An Increase in the Money Supply Causes _____ in Output

question 113

Multiple Choice

An increase in the money supply causes _____ in output in the short run and _____ in output in the long run.

• A) an increase; no change
• B) an increase; an increase
• C) no change; an increase
• D) no change; no change

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Definitions:

Incremental Annual Cash Flow

The additional cash flow an organization receives from taking on a new project or investment, calculated on an annual basis.

CCA Class

A category within the Capital Cost Allowance system in Canada for tax depreciation of assets.

Lease

A contractual arrangement whereby a lessor allows a lessee to use an asset in return for periodic payments for a specified period of time.

CCA Class

A category under the Canadian tax system that determines the depreciation rate for tax purposes on capital assets.