Suppose the Central Bank, as Expected, Increases the Money Supply

Multiple Choice

Suppose the central bank, as expected, increases the money supply as the result of a decision for monetary expansion. Which of the following will occur as a result?

A) Stock prices increase only if goods prices increase.
B) A decrease in stock prices.
C) No change in stock prices.
D) An increase in stock prices.
E) An ambiguous effect on stock prices.