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When the Federal Reserve Increases the Growth Rate of the Money

Question 33

Multiple Choice

When the Federal Reserve increases the growth rate of the money supply to combat a negative real shock,the growth rate of real GDP:


A) will increase more than the inflation rate.
B) will increase less than the inflation rate.
C) and the inflation rate will both increase by the same amount.
D) and the inflation rate will both decrease by the same amount.

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