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In the as/ad model, an expansionary monetary policy has the greatest effect on the price level when it

Aincreases both nominal and real income
Bincreases real income but not nominal income
Cincreases nominal income but not real income
Ddoesn't increase real or nominal income

Verified Answer :

metchelle

The answer that would best complete the given statement above would be option B. In the as/ad model, an expansionary monetary policy has the greatest effect on the price level when it  increases real income but not nominal income. Hope this answers your question.

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