<p><span class=\"answerpad\">A.&#160; If a central bank increases the money supp

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<p><span class="answerpad">A.&#160; If a central bank increases the money supply, then</span><br /><br /><br /><label for="48_RESP_MC1"><input id="48_RESP_MC1" name="48_RESP_MC" type="radio" value="MC1" /> 1. <span class="answerpad">prices and output rise and unemployment falls.</span><br /><br /></label><label for="48_RESP_MC2"><input id="48_RESP_MC2" name="48_RESP_MC" type="radio" value="MC2" /> 2. <span class="answerpad">prices rise and output and unemployment fall.</span><br /><br /></label><label for="48_RESP_MC0"><input id="48_RESP_MC0" name="48_RESP_MC" type="radio" value="MC0" /> 3. <span class="answerpad">prices, output, and unemployment rise.</span><br /><br /></label><label for="48_RESP_MC3"><input id="48_RESP_MC3" name="48_RESP_MC" type="radio" value="MC3" /> 4. <span class="answerpad">prices fall and output and unemployment rise.</span><br /></label></p>
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<p><span class="answerpad">B. If the central bank increases the money supply, in the short run, output</span><br /><br /><br /><label for="49_RESP_MC2"><input id="49_RESP_MC2" name="49_RESP_MC" type="radio" value="MC2" /> 1. <span class="answerpad">falls so unemployment rises.</span><br /><br /></label><label for="49_RESP_MC1"><input id="49_RESP_MC1" name="49_RESP_MC" type="radio" value="MC1" /> 2. <span class="answerpad">rises so unemployment falls.</span><br /><br /></label><label for="49_RESP_MC0"><input id="49_RESP_MC0" name="49_RESP_MC" type="radio" value="MC0" /> 3. <span class="answerpad">rises so unemployment rises.</span><br /><br /></label><label for="49_RESP_MC3"><input id="49_RESP_MC3" name="49_RESP_MC" type="radio" value="MC3" /> 4. <span class="answerpad">falls so unemployment falls.</span><br /><br /></label></p>

Explanation / Answer

prices and output rise and unemployment falls

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