If the Money Supply Increases When There Is Much Idle

question 36

Multiple Choice

If the money supply increases when there is much idle capacity in the economy,

• A)most of the resulting rise in nominal GDP will be a result of price increases
• B)most of the resulting rise in nominal GDP will be a result of increases in real output
• C)most of the resulting rise in real GDP will be a result of increases in the price level
• D)most of the resulting rise in real GDP will be a result of increases in the interest rate
• E)only nominal GDP will change; real GDP will be unaffected

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Definitions:

Breach of Contract

The failure to fulfill one's obligations as agreed upon in a contract, allowing for legal action by the aggrieved party.

Primary Benefit Test

A legal doctrine used to determine who is the primary beneficiary of a service or transaction, often influencing the decision on liability or responsibility under the law.

Privity of Contract

The relationship that exists between the parties involved in a contract, allowing them to sue each other but preventing any third party from doing so.

Fraud

involves deliberate deception to secure unfair or unlawful gain, or to deprive a victim of a legal right.