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An Increase in the Money Supply

Question 22

Multiple Choice

An increase in the money supply:

A) increases the ability of the economy to produce goods and services, increases the demand for goods and services, and increases the price level
B) leaves unchanged the ability of the economy to produce goods and services, increases the demand for goods and services and increases the price level
C) leaves unchanged the ability of the economy to produce goods and services, increases the demand for goods and services and decreases the price level
D) leaves unchanged the ability of the economy to produce goods and services, decreases the demand for goods and services, and decreases the price level

Correct Answer: