Suppose That the Money Supply Increases

question 206

Multiple Choice

Suppose that the money supply increases. In the short run, this increases prices according to

• A)both the short-run Phillips curve and the aggregate demand and aggregate supply model.
• B)neither the short-run Phillips curve nor the aggregate demand and aggregate supply model.
• C)the short-run Phillips curve, but not according to the aggregate demand and aggregate supply model.
• D)the aggregate demand and aggregate supply model but not according to the short-run Phillips curve.

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Definitions:

Respondent Behavior

Behavior that occurs as a direct response to a specific stimulus without conscious thought.

Spontaneous Recovery

In psychology, the reappearance of a conditioned response after a delay or period of extinction.

Consistent

Showing steady conformity to character, profession, belief, or custom.

Experiments

Research methods employed to explore, verify a hypothesis, or prove an established truth.