An increase in money supply growth will lead to an overall decrease in interest rate if liquidity effect is greater than the income, price-level, and expected-inflation effect

Economics Jan 10, 2021

An increase in money supply growth will lead to an overall decrease in interest rate if liquidity effect is greater than the income, price-level, and expected-inflation effect." Determine whether the above statement is TRUE or FALSE. Justify your answer with an appropriate diagram.