Suppose that the bond market and the money market both start out in equilibrium, then the Federal Reserve increases the money supply. The result will be a ______________ in the money market and a _________________ in the bond market, which will push bond prices _________________ and interest rates will ___________________ until a new equilibrium is reached

A) surplus; shortage; up; fall
B) shortage; surplus; down; rise
C) surplus; shortage; down; rise
D) shortage; surplus; down; fall


A

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