Monetarists differ from Classical economists in that they argue that
A) changes in the money supply affect only the price level in the long run.
B) velocity is not fixed but is predictable.
C) the economy tends to be stable around full employment.
D) the demand for money is a fixed fraction of nominal GDP.
B
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The two most comprehensive, widely accepted macroeconomic models are
A) the classical model and the supply-side model. B) the supply-side model and the real business cycle model. C) the classical model and the Keynesian model. D) the Austrian model and the Keynesian model.
Assume the Treasury borrows $5 billion from the non-bank public and spends it
The effect on bank reserves is that they will __________ by $5 billion when the Treasury borrows and then bank reserves will __________ by $5 billion when the Treasury spends the money. A) rise; fall B) fall; rise C) rise; rise D) fall; fall