The economy of Umrica uses palladium as its money. If the government discovers a large reserve of palladium on their land the
A)supply of money decreases, the value of money rises, and prices fall.
B)supply of money increases, the value of money falls, and prices rise.
C)demand for money increases, the value of money rises, and prices rise.
D)demand for money decreases, the value of money falls, and prices fall.

Question

Quizplus · Accepted Answer

Discovering a large reserve of palladium increases the supply of money. As the supply of money increases, its value decreases, leading to higher prices, or inflation.

The Economy of Umrica Uses Palladium as Its Money