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"If the Money Supply Rises by $1 Billion, GDP Will

Question 38

Multiple Choice

"If the money supply rises by $1 billion, GDP will rise until it alone increases the quantity of money demanded by $1 billion." This describes the situation when


A) an IS curve shifts against a horizontal LM curve.
B) an IS curve shifts against a vertical LM curve.
C) a vertical LM curve shifts against an IS curve.
D) a horizontal LM curve shifts against an IS curve.

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