The Most Likely Impact of an Unanticipated Increase in the Money

question 106

Multiple Choice

The most likely impact of an unanticipated increase in the money supply is a(n) :

• A)​increase in the real interest rate, which in turn stimulates investment and GDP.
• B)​decrease in the real interest rate, which in turn stimulates investment and GDP.
• C)​decrease in real output, which causes the real interest rate to decline and in turn stimulate investment and GDP.
• D)​increase in real output, which causes the real interest rate to decline.

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Definitions:

Expected Proportion

The predicted likelihood of an event occurring in a specific category or group.

Dependent

In statistics, referring to a variable that is assumed to depend on or be caused by another (independent) variable.

Come-Out Roll

The initial roll of the dice in a round of craps that determines the point or results in a win or loss for bets on the "Pass" and "Don't Pass" lines.

Immediate Loss

The loss recognized or experienced without delay upon the occurrence of a specific event.