Exhibit 14-1

-Refer to the graph in the exhibit.Suppose there is an increase in level of GDP.What will this increase cause?

Question

Exhibit 14-1
 
-Refer to the graph in the exhibit.Suppose there is an increase in level of GDP.What will this increase cause?

Quizplus · Accepted Answer

An increase in level of GDP will cause a shift in the demand for money from DM to DM', which represents an increase in demand for money due to increased economic activity. Therefore, the correct choice is C. Options A and B are not relevant as they refer to movements along the same curve, whereas the question asks about a shift in the curve. Option D is also incorrect as it does not accurately represent the shift in demand for money due to an increase in GDP.

Exhibit 14-1 -Refer to the Graph in the Exhibit.Suppose There Is an Exhibit.Suppose