
-If the economy's aggregate demand and supply curves are AD₁ and AS₁,an increase in the money supply will:
A) lower total real output and raise the price level as aggregate supply shifts from AS₁ to AS₀.
B) lower total real output and leave the price level unchanged because AD₁ will shift to AD₀.
C) raise total real output but not the price level, for aggregate supply will shift from AS₁ to AS₂.
D) raise both total real output and the price level as aggregate demand shifts from AD₁ to AD₂.
E) raise the price level but leave total real output unchanged, as aggregate demand shifts from AD₁ to AD₂ and aggregate supply shifts from AS₁ to AS₀.
Correct Answer:
Verified
Q61: In its reaction to financial crises in
Q62: In general,the discount rate is kept close
Q63: In 1965,President Johnson opposed a tax increase
Q64: Between 1929 and 1931,about 2,000 banks failed
Q65: It has been estimated that the full
Q66: The results of the Fed's efforts to
Q68: The Fed's freedom to control the supply
Q69: A decrease in the money supply
A) shifts
Q70: An increase in the money supply
A) shifts
Q71: The Banking Act of 1935 has been
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents