Increase in price affects the real money supply

Reference no: EM1374329

A change in real money supply can result either from a change in nominal money supply through Federal Reserve policy [holding the price level constant] or from a change in the price level (holding the nominal money supply constant). The change in the nominal money supply causes a shift in the aggregate demand curve, whereas a change in the price level causes a movement along the aggregate demand curve. Explain.

Reference no: EM1374329

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