9. A change in the money supply is neutral if it leads to a proportional change in

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9. A change in the money supply is neutral if it leads to a proportional change in the price level but does not affect real variables. In the IS-LM-FE model, money is neutral after prices have adjusted and the economy has returned to general equilibrium.

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Macroeconomics Plus Myeconlab With Pearson Global Edition

ISBN: 377221

9th Canadian Edition

Authors: Andrew B. Abel ,Ben Bernanke ,Dean Croushore

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