In the liquidity-preference model, an increase in the money supply causes
A. the nominal interest rate to increase and the equilibrium quantity of money to decrease.
B. the nominal interest rate to increase and the equilibrium quantity of money to remain unchanged.
C. the nominal interest rate to decrease and the equilibrium quantity of money to remain unchanged.
D. the nominal interest rate to decrease and the equilibrium quantity of money to increase.
Answer: D
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