Suppose the demand for money and the supply of money increase simultaneously.We can:

Question

Quizplus · Accepted Answer

The simultaneous increase in the demand for money and supply of money can have complex effects on the interest rates and bond prices, and therefore it is difficult to predict what will happen. The outcome will depend on the relative magnitude of the changes in demand and supply, as well as other factors such as economic growth and inflation expectations. Therefore, choice D is the best answer.

Suppose the Demand for Money and the Supply of Money