An Increase in the Money Supply Will Affect Aggregate Demand

question 114

Multiple Choice

An increase in the money supply will affect aggregate demand

• A) only if the increase in the money supply causes interest rates to rise.
• B) only if the increase in the money supply causes people to buy less goods and services.
• C) only if the increase in the money supply causes people to increase their saving.
• D) if the increase in the money supply causes interest rates to fall and/or causes people to buy more goods and services.

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Definitions:

Calcium

A chemical element and an essential nutrient for living organisms, critical for bone health, muscle function, and nerve signaling.

Sodium

A chemical element (Na) that is an essential mineral for life, involved in nerve impulse transmission and muscle function.

Aerobic Respiration

The process by which cells convert glucose and oxygen into energy, carbon dioxide, and water, requiring oxygen to proceed.

Creatine Phosphate

A molecule that stores energy in muscle cells, releasing it quickly to produce ATP during intense physical activity.