Other things the same,which of the following happens if the price level rises?
A)Money demand shifts rightward.
B)Initially there is an excess demand for money in the money market.
C)The interest rate rises.
D)All of the above are correct.

Question

Quizplus · Accepted Answer

If the price level rises, the demand for money shifts rightward because more money is needed to purchase the same amount of goods and services. This leads to an initial excess demand for money in the money market, which causes the interest rate to rise as people compete to borrow money. Therefore, all of the above options are correct.

Other Things the Same,which of the Following Happens If the Price