The short-run effect of an increase in the supply of money is
A) an increase in the price level, a decrease in real Gross Domestic Product (GDP), but an increase in nominal national income.
B) an increase in the price level but not in real Gross Domestic Product (GDP).
C) an increase in both real Gross Domestic Product (GDP) and the price level.
D) an increase in real Gross Domestic Product (GDP) but not in the price level.
C
You might also like to view...
If the economy is currently in equilibrium at a level of GDP that is above potential GDP, which of the following would move the economy back to potential GDP?
A) a decrease in interest rates B) a decrease in wealth C) a decrease in the value of the dollar relative to other currencies D) an increase in business confidence
The spending multiplier is defined as:
a. the ratio of the change in equilibrium real GDP to the initial change in spending. b. the change in initial spending divided by the change in personal income. c. 1 / (marginal propensity to consume). d. 1 / (1 ? marginal propensity to save).
There is an Italian soccer player who makes more than $10 million a year. Why?
Refer to the information provided in Table 8.3 below to answer the question(s) that follow.
Table 8.3Refer to Table 8.3. The marginal cost of the fourth unit is ________ and the average total cost of four units is ________.
A. $30; $35 B. $20; $45 C. $10; $30 D. indeterminate from the given information