The quantity theory of money states that if the velocity of money is stable or at least predictable, then:
a. the quantity of money in circulation determines real GDP in the short run
b. the quantity of money in circulation determines aggregate spending.
c. the quantity of money in circulation determines both real GDP and the price level in the long run.
d. the quantity of money in circulation determines only the price level in the long run.
e. the quantity of money in circulation determines the potential output in the long run.
d
You might also like to view...
The price elasticity of demand measures the ________ that results from a ________
A) change in quantity demanded; change in price B) change in price; change in the quantity demanded C) percentage change in price; percentage change in the quantity demanded D) percentage change in the quantity demanded; percentage change in price E) percentage change in the quantity demanded; change in price
Assuming zero transactions costs, if your local grocer buys oranges at a low price from an orchard and resells them to you at a higher price, then the grocer's revenue minus costs is known as
A) transactions profits. B) pure profits. C) excess profits. D) arbitrage profits.