When a Country's Central Bank Increases the Money Supply, Which

Multiple Choice

When a country's central bank increases the money supply, which of the following happens to a unit of that country's money?

A) It gains value both in terms of the domestic goods and services it can buy and in terms of the foreign currency it can buy.
B) It gains value in terms of the domestic goods and services it can buy, but loses value in terms of the foreign currency it can buy.
C) It loses value in terms of the domestic goods and services it can buy, but gains value in terms of the foreign currency it can buy.
D) It loses value both in terms of the domestic goods and services it can buy and in terms of the foreign currency it can buy.