According the AS/AD model,in the long run,expansionary monetary policy will
A) increase both real GDP and the price level.
B) decrease both real GDP and the price level.
C) decrease the price level and leave real GDP unchanged.
D) increase the price level and leave real GDP unchanged.
E) increase real GDP and reduce the price level.

Question

Quizplus · Accepted Answer

In the long run, the AS curve is vertical, so changes in the money supply will only affect the price level, not real GDP. Therefore, an expansionary monetary policy will increase the price level but leave real GDP unchanged.

According the AS/AD Model,in the Long Run,expansionary Monetary Policy Will