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    tonynk9's Avatar
    tonynk9 Posts: 4, Reputation: 1
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    #1

    Apr 13, 2008, 06:39 AM
    Can anyone helps to explain the links between changes in the nations money supply the
    Can anyone helps to explain the links between changes in the nations money supply the interest rate investment spending aggregate demand and real GDP and the price level?
    excon's Avatar
    excon Posts: 21,482, Reputation: 2992
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    #2

    Apr 13, 2008, 07:17 AM
    Hello tony:

    Homework?? My answer ain't going to get you a good grade.

    I can tell you that interest rate is the cost of money. When money is in short supply, it costs more. When there's a lot of it around, it costs less.

    Now, I'm not familiar with fancy words like "investment spending aggregate" or real GDP. All I know is when you increase the money supply without a corresponding increases in goods and services, prices go up.

    excon
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