In the Keynesian model in the long run,an increase in the money supply will raise
A)the price level but not the level of output.
B)the level of output but not the price level.
C)both the level of output and the price level.
D)neither the level of output nor the price level.

Question

Quizplus · Accepted Answer

In the Keynesian model, in the long run, an increase in the money supply is believed to raise the price level due to inflationary pressures, but it does not affect the level of output, which is determined by real factors like technology, resources, and labor.

In the Keynesian Model in the Long Run,an Increase in the Money