An increase in the nation's money supply leads to which of the following?

Question

Quizplus · Accepted Answer

An increase in the nation's money supply can lead to both proportionate increases in prices (as more money is available to spend on the same amount of goods and services, causing inflation) and depreciation of the nation's currency in the long run (as the increased money supply may lead to higher inflation rates, which can decrease the value of the currency).

An Increase in the Nation's Money Supply Leads to Which