Since classical economists and monetarists believe that the economy operates at full employment along the vertical segment of aggregate supply,:
A. any increase in the money supply can only end up raising the price level.
B. any increase in the money supply can only end up lowering the price level.
C. any decrease in the money supply can only end up raising the price level.
D. changes in the money supply will not affect the price level.
Answer: A
You might also like to view...
Jennifer consumes both apples and bread. Let Pa be the price of an apple and Pb the price of a loaf of bread. TUa is her total utility from apples and TUb is her total utility from bread
MUa is her marginal utility from apples and MUb is her marginal utility from bread. When Jennifer is in consumer equilibrium A) MUa/TUa = MUb/TUb. B) MUa/Pb = MUb/Pa. C) MUa/Pa = MUb/Pb. D) TUa/Pb = TUb/Pb.
A surprising outcome of the Rock-Paper-Scissors game is that
A) it is a clear example of a first mover advantage. B) there is no pure-strategy Nash equilibrium. C) it is best not to play the game. D) it is a good way to determine who goes first in a sequential move game.