In the New Keynesian Model, an Increase in the Money

Multiple Choice

In the New Keynesian model, an increase in the money supply

A) has no effect on the price level.
B) causes a less than proportional increase in the price level.
C) causes an equiproportional increase in the price level.
D) causes a more than proportional increase in the price level.
E) causes a reduction in the price level.