In the new classical model,an anticipated policy of a continually increasing money supply ________.
A) causes the aggregate demand curve to shift continually to the right
B) causes the aggregate demand curve to shift continually to the left
C) is shown as a movement along the aggregate demand curve
D) both b and C of the above

Question

Quizplus · Accepted Answer

In the new classical model, an anticipated policy of a continually increasing money supply causes the aggregate demand curve to shift continually to the right as people expect higher prices and adjust their behavior accordingly.

In the New Classical Model,an Anticipated Policy of a Continually