A permanent increase in the domestic money supply
A) must ultimately lead to a proportional decrease in E, and, therefore, the expected future exchange rate must rise proportionally.
B) must ultimately lead to a proportional decrease in E, and, therefore, the expected future exchange rate must decrease proportionally.
C) must ultimately lead to a proportional rise in E, and, therefore, the expected future exchange rate must rise proportionally.
D) must ultimately lead to a proportional rise in E, and, therefore, the expected future exchange rate must rise more than proportionally.
E) must ultimately lead to a proportional rise in E, and, therefore, the expected future exchange rate must rise less than proportionally.
C
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An economic policy initiative results in the AD curve shifting to the right. As a result,
A) the price level will rise. B) the price level will stay constant. C) the price level will fall. D) Real GDP will rise in the short run. E) a and d
The Conservation Reserve Program pays farmers to take land out of production. The primary focus of the program is on
A) improving rural landscapes by creating more forested land. B) reducing erosion. C) improving habitat for endangered species. D) maintaining water quality.