Business, 20.03.2020 01:59, nnaomii

According to the classical theory of inflation, an increase in the money supply would cause to shift to the . Output would and price level would . However, in the long run, would shift to the . Output would and the price level would .

Answers: 1

Show answers

Answers

According to the classical theory of inflation, an increase in the money supply would cause aggregate demand curve to shift to the right. Output would increase and price level would increase. However, in the long run, would shift to the left. Output would reduce and the price level would continue to increase.

Explanation:

Inflation occurs in an economy when the overall price level increases and the demand of goods and services increases.

the classical theory of inflation explains how the aggregate price level gets determined through the interaction between money supply and money demand.

Tn the classical theory of inflation:

Money is considered the asset which is utilized by people to purchase goods and services on a regular basis.Their view is that the general price is determined by the total demand for and total supply of goods just as the price of any good is determined by the forces of demand and supply for it.According to them inflation is a situation caused by excess demand, in which the total demand for goods as measured by the volume of money offered is in excess of supply of goods at prevailing prices.

answered: enrique3300

According to the classical theory of inflation, an increase in the money supply would cause aggregate demand curve to shift to the right. Output would increase and price level would increase. However, in the long run, aggregate demand curve would shift to the left. Output would reduce and the price level would continue to increase.

Explanation:

An economy can only experience a persistent rise in the price of goods and services when the price of goods and services increases, as well as the demand for these goods and services. When we take a look at the classical theory of inflation we discover how we determine the aggregate price level by the communication between the demand and supply of money.

answered: Guest

Don’t know can’t tell you my friend

answered: Guest

the famous singer stefani joanne angelina germanotta is welly known as lady gaga

Other questions on the subject: Business

Business, 21.06.2019 19:00, vpoon6739

If a company’s employees are angry about their work, a visiting auditor may also become agitated, illustrating the power of

Answers: 1

continue

Business, 21.06.2019 21:00, castiaulii16

The market for corn in country a is highly competitive. at the current market price of $5/bushel there is a shortage of 100,000 bushels of corn in this country. media reports claim that the price of corn will rise drastically in the near future. according to these reports, the neighboring country b had witnessed a similar situation recently. at the same price, the shortage in country b was also 100,000 bushels and eventually the equilibrium price in b went up to $10/bushel. both countries are known to have equal number of corn producers and the market supply of corn is identical at all prices. this, combined with the fact that consumers in the two countries also have similar tastes and preferences, led the media to conclude that the price of corn in country a would soon be as high as $10/bushel. the new equilibrium price turns out to be below $10/bushel, what inferences can be drawn?

Answers: 3

continue

Business, 22.06.2019 14:20, kevinglvz

Anew 2-lane road is needed in a part of town that is growing. at some point the road will need 4 lanes to handle the anticipated traffic. if the city's optimistic estimate of growth is used, the expansion will be needed in 4 years and has a probability of happening of 40%. for the most likely and pessimistic estimates, the expansion will be needed in 8 and 15 years respectively. the probability of the pessimistic estimate happening is 20%. the expansion will cost $ 4.2 million and the interest rate is 8%. what is the expected pw the expansion will cost?

Answers: 1

continue

Business, 22.06.2019 19:30, dfrtgyuhijfghj4794

About 20 years ago, sturdy light, inc., produced a sturdy, lightweight backpack in a market that was rapidly growing. sturdy light became a leader in this market. eventually, the backpack market reached the maturity stage and slowed down. however, by this time, sturdy light had developed a strong brand name and continued to steadily lead the market. which of the following describes this scenario? a. sturdy light was a star that developed into a cash cow. b. sturdy light was a question mark that developed into a star. c. sturdy light was a dog that developed into a question mark. d. sturdy light was a cash cow that developed into a star.

Answers: 2

continue

Do you know the correct answer?

According to the classical theory of inflation, an increase in the money supply would cause to shif...