How does an increase in money supply in an economy lead to inflation?
How does an increase in money supply in an economy lead to inflation?
发布时间：2025-07-09 21:12:58
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答案：A government increasing the money supply is analogous to giving people more money. An increase in the money supply makes it easier for banks to borrow from the government and for individuals and companies to borrow from banks. The resulting increase in credit causes increases in demand for goods and services. Unless the output of goods and services is growing at a rate similar to that of the money supply, the result will be inflation. This relationship has been observed time after time in country after country.
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- 1.How does an increase in money supply in an economy lead to inflation?
- 2.An increase in the money supply decreases the equilibrium interest rate and shifts the aggregate-demand
- 3.How does the US government intervene the economy?
- 4.How long does it take to transfer the money?
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- 7.An increase in the supply of labor
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