A decrease in the real money supply can result from:
A) increase in the nominal money supply or an increase in the price level.
B) increase in the nominal money supply or a decrease in the price level.
C) decrease in the nominal money supply or an increase in the price level.
D) decrease in the nominal money supply or a decrease in the price level.
C
You might also like to view...
Suppose a recession occurs as a result of a supply shock, and instead of the economy naturally working its way back to equilibrium, the government uses policy to shift the aggregate demand curve to fight the recession. Using policy this way would
A) quickly result in a new, higher level of real GDP and a permanently lower price level. B) bring real GDP back to potential GDP more slowly but would bring the price level back to the original price level more quickly. C) bring the price level back to its original level more quickly but would result in a permanently lower level of potential GDP. D) bring real GDP back to potential GDP more quickly but would result in a permanently higher price level.
Fiscal policy is
A) the selling of government bonds by the Treasury. B) the deliberate manipulation of the money supply designed to affect the interest rate. C) the deliberate manipulation of taxation and spending designed to affect the economy. D) the selling of foreign exchange reserves designed to change the exchange rate. E) All of the above.