Fed increases the supply of money

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Reference no: EM131385820

In general, if the Fed increases the supply of money by 5%, which of the following statements can we claim to be true with certainty? (In general means, do not make any assumptions about anything.)

A. The price level will increase by 5%, but the real GDP will remain the same.

B. The real GDP will increase by 5%, but the price level will remain the same.

C. The Nominal GDP will increase by 5%.

D. We cannot claim any of the above to be true with certainty.

Reference no: EM131385820

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