Assume Individuals Consider Only the Short-Run Effects of Changes in Future

Multiple Choice

Assume individuals consider only the short-run effects of changes in future macro variables when forming expectations of future output and future interest rates.A permanent increase in the money supply,with no other policy change implemented or anticipated,will most likely cause

A) an increase in the current interest rate.
B) an increase in future output and an increase in the future interest rate.
C) an unknown effect on the current interest rate.
D) all of the above
E) none of the above