Holding everything else constant,an increase in the growth rate of the money supply will cause the aggregate demand curve to:
A) shift inward.
B) shift outward.
C) not shift at all.
D) shift randomly.

Question

Quizplus · Accepted Answer

An increase in the growth rate of the money supply will lead to an increase in the supply of money to borrowers, causing interest rates to fall. This, in turn, will encourage households and businesses to borrow and spend more, leading to an increase in overall demand in the economy. As a result, the aggregate demand curve will shift outward.

Holding Everything Else Constant,an Increase in the Growth Rate of the Money