The simple quantity theory of money predicts that changes in
A) the money supply lead to strictly proportional changes in the price level.
B) the money supply do not affect the price level.
C) the price level lead to strictly proportional changes in velocity and GDP.
D) velocity lead to nearly proportional changes in the money supply.
A
You might also like to view...
A sharp increase in the number of medical errors increases the number of lawyers hired to determine medical malpractice settlements. This will
A) increase GDP and increase well-being in the economy. B) increase GDP and decrease well-being in the economy. C) decrease GDP and increase well-being in the economy. D) decrease GDP and decrease well-being in the economy.
Classical economists believe aggregate spending adjusts quickly to equal full-employment output.
Answer the following statement true (T) or false (F)