Which of the following is a consequence of increasing the money supply?

Increasing the money supply typically leads to lower interest rates, which encourages borrowing and spending by consumers and businesses. When individuals have easier access to loans, they tend to borrow more to finance purchases, whether it be for homes, cars, or other goods. This increased borrowing leads to higher consumer spending, thus boosting demand in the economy.

Furthermore, businesses may take advantage of the lower interest rates to invest in expansion projects, such as purchasing new equipment or building new facilities, which again contributes to economic growth. Consequently, this enhanced spending and investment activity can stimulate overall economic growth, increasing output and employment.

The other consequences of increasing the money supply are likely to include higher inflation in the long run, slower economic growth if the money supply is excessively increased, or a rise in interest rates eventually if inflation expectations change. However, in the immediate term and the context of the question, increased consumer spending and investment are clear outcomes of an increased money supply.