The demand for money increases and the demand for money curve shifts rightward if
A)real GDP increases.
B)the nominal interest rate increases.
C)the inflation rate increases.
D)the real interest rate increases.
E)the price level falls.

Question

Quizplus · Accepted Answer

An increase in real GDP leads to higher income and spending, which increases the demand for money, shifting the demand curve rightward.

The Demand for Money Increases and the Demand for Money