An Increase in the Money Supply in the Short Run

question 55

Multiple Choice

An increase in the money supply in the short run changes ____, whereas in the long run, ____ change.

• A) exchange rates; nominal interest rates
• B) price levels; interest rates
• C) interest rates; interest rates
• D) interest rates; inflation rates

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Definitions:

Chihuahuas

A small dog breed originating from Mexico, known for its small size, big ears, and spirited personality.

Terrified

Experiencing extreme fear or terror, often as a response to a perceived threat or danger.

Higher-order Conditioning

A learning process where a conditioned stimulus is paired with a new neutral stimulus, causing the neutral stimulus to elicit the conditioned response without a direct association with the unconditioned stimulus.

Classical Conditioning

A learning process that occurs through associations between an environmental stimulus and a naturally occurring stimulus, famously demonstrated by Pavlov's dogs.