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

Question

Quizplus · Accepted Answer

When real GDP increases, people engage in more transactions, which increases the demand for money, causing the demand for money curve to shift rightward.

The Demand for Money Increases and the Demand for Money