The long run effects of money supply change
A) ambiguous effect on the long-run values of the interest rate or real output, a proportional change in the price level's long-run value in the opposite direction.
B) proportional effect on the long-run values of the interest rate or real output, a proportional change in the price level's long-run value in the same direction.
C) no effect on the long-run values of the interest rate or real output, a proportional change in the price level's long-run value in the same direction.
D) no effect on the long-run values of the interest rate or real output, no change in the price level's long-run value.
E) ambiguous effect on the long-run values of the interest rate or real output, A disproportional change in the price level's long-run value in the same direction.
C
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The expenditure multiplier equals 5 and there is a $3 million increase in investment. Equilibrium expenditure
A) increases by $5 million. B) increases by $0.60 million. C) increases by $15 million. D) decreases by $15 million. E) increases by $3 million.
Refer to Figure 6-9. The data in the diagram indicates that DVDs are
A) luxury goods. B) inelastic goods. C) necessities. D) both luxury goods and inelastic goods. E) both necessities and inelastic goods.