An increase in the money supply is represented by a(n):
A) rightward shift of the downward-sloping money supply curve.
B) upward shift of the money supply curve.
C) rightward shift of the money supply curve.
D) increase in the rate of interest.

Question

Quizplus · Accepted Answer

An increase in the money supply means that there is more money available in the economy. This is represented by a rightward shift of the money supply curve, showing that at every given price level, there is more money available. This increase in the money supply can lead to a decrease in interest rates and an increase in economic activity.

An Increase in the Money Supply Is Represented by A(n)