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Suppose That the Price Level Does Not Change While Real

Question 108

Multiple Choice

Suppose that the price level does not change while real GDP decreases. As a result,


A) the demand for money increases and the demand for money curve shifts rightward.
B) the supply of money curve shifts leftward.
C) the supply of money curve shifts rightward.
D) the quantity of money demanded decreases and there is a movement downward along the demand for money curve.
E) the demand for money decreases so that households and firms hold smaller amounts of money.

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