There is some evidence that high money supply growth may lead to _______ U.S. inflation over time, which in turn places ____ pressure on U.S. interest rates.
A)higher; upward
B)higher; downward
C)lower; downward
D)lower; upward

Question

Quizplus · Accepted Answer

High money supply growth can lead to higher inflation over time. As inflation increases, it typically exerts upward pressure on interest rates as lenders demand higher returns to compensate for the reduced purchasing power of money.

There Is Some Evidence That High Money Supply Growth May