Economics 9708 · AS & A Level · Monetary policy

Monetary policy — practice question

According to monetarist theory, if the money supply rises unexpectedly, what is the short-run effect on money wages, real wages and the level of employment?

  • Amoney wages: increase; real wages: decrease; employment: increase
  • Bmoney wages: increase; real wages: increase; employment: decrease
  • Cmoney wages: decrease; real wages: increase; employment: decrease
  • Dmoney wages: decrease; real wages: decrease; employment: increase

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