Economic growth solves the problem of scarcity.

According to the assumptions of the quantity theory of money, if the money supply increases by 5 percent, then

a. nominal and real GDP would rise by 5 percent. b. nominal GDP would rise by 5 percent; real GDP would be unchanged. c. nominal GDP would be unchanged; real GDP would rise by 5 percent. d. neither nominal GDP nor real GDP would change.

Suppose the equilibrium price in the market is $200 and the marginal revenue associated with the linear (inverse) demand function is ?$200. Then we know that the own price elasticity of demand is:

A. ?1. B. ?0.5. C. 2. D. It cannot be determined from the information contained in the question.