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Classical aggregate demand curve

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Reference no: EM131233115

If the propensity to hold money is 6 and the money supply is 12, then the classical aggregate demand curve is

A) P = 2Y

B) P/Y = 48

C) P = 1/(2Y)

D) P = 2/Y

According to the classical model, a 10-percent increase in the money supply, holding everything else constant, will lead to

A) A 10% increase in prices, a 10% increase in the real wage, and a 10% increase in interest rates.

B) A 10% increase in prices, a 10% increase in the money wage, and a 10% increase in interest rates.

C) A 10% increase in prices, a 10% increase in the money wage, and no change in interest rates.

D) A 10% increase in prices and no change in the money wage or interest rates.

None of the above.

Reference no: EM131233115

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