In the long run, a change in the money supply will affect: I. the interest rate.
II) real GDP.
III) prices.
A) I only
B) II only
C) III only
D) I, II, and III

Question

Quizplus · Accepted Answer

In the long run, a change in the money supply primarily affects prices. According to classical economic theory, in the long run, prices adjust to changes in the money supply, while real variables like real GDP and interest rates are determined by real factors like productivity and preferences, not by the money supply.

In the Long Run, a Change in the Money Supply