Multiple Choice
In the Keynesian transmission mechanism,if the money market is in the liquidity trap,an increase in the money supply will
A) cause total expenditures and aggregate demand to increase.
B) cause total expenditures and aggregate demand to decrease.
C) have no impact on total expenditures and aggregate demand.
D) cause total expenditures to increase and aggregate demand to decrease.
E) cause total expenditures to decrease and aggregate demand to increase.
Correct Answer:
Verified
Correct Answer:
Verified
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