Monetarists believe that an increase in the money supply will lead to:

Question

A. An increase in the price level
B. An increase in nominal GDP
C. An increase in real GDP
D. Both an increase in the price level and an increase in nominal GDP
E. All of the above

Answer 1

E. All of the above

Monetarists believe that an increase in the money supply will lead to an increase in the price level, an increase in nominal GDP, and an increase in real GDP.