Question:

Effects of an increase in money??

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Relating to excerpts to the quantity theory of money, what is the effect of an increase in the quantity of money?

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  1. More money will lead to excess supply of money thus causing to inflation - increase in price level. It's the same old rule of demand and supply - with unchanged demand increased supply will lead to depreciation in value.

    In the long-run money are neutral for real economy.


  2. regular supply and demand. The more money out the less it is worth.

  3. Increased Consumer Spending.

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