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Posted by Kajal Chauhan 6 years, 5 months ago
- 2 answers
Yogita Ingle 6 years, 5 months ago
Excess of money supply will lead to an increase in general price level prevailing in the economy (or inflation) because the production of goods and services will remain the same. This increase in general price level will lead to an increase in interest rates on investment expenditures resulting in a fall in investment activities in the economy. Hence, economic growth will be adversely affected by such inflationary pressures.
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Nagasaki Ali 6 years, 5 months ago
1Thank You