Figure 26-1 -Refer to Figure 26-1. In the figure, the money demand curve would move from Money demand₁ to Money demand₂ if A) real GDP increased. B) the price level decreased. C) the interest rate increased. D) the Federal Reserve sold Treasury securities.

Question

Quizplus · Accepted Answer

An increase in real GDP would increase the demand for money as more transactions occur, shifting the money demand curve to the right from Money demand₁ to Money demand₂.

Figure 26-1 -Refer to Figure 26-1. in the Figure, the Money Demand