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Question
If initially the money supply is $1 trillion, velocity is 5, the price level is 1, and real GDP is $5 trillion, an increase in the money supply to $2 trillionA. increases real GDP to $10 trillion.
B. causes velocity to fall to 2.5.
C. increases the price level to 2.
D. increases the price level to 2 and velocity to 10.
Answer
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