The diagram below shows a shift in the money demand curve for an economy. Whi...

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The diagram below shows a shift in the

money demand curve for an economy.

Which of the following could explain what is observed in the

diagram?

An expectation that the real rate of interest on bonds will fall in the near future

❌

An increase in the level of nominal GDP

✅✨

A decline in the rate on inflation in the economy

❌

A decline in bond prices in the economy

❌

A decline in the nominal interest rate

❌

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