Given the reserve-holding ratio e and the fraction of deposits held as cash c, the deposit multiplier becomes

What does the quantity theory of money imply? If the growth rate of money supply and growth rate of real GDP in an economy are 8% and 6%, respectively, then what is the inflation rate in the economy?

What will be an ideal response?

The graph illustrates the supply of soda. If the price of soda rises from $0.50 a can to $1.50 a can, the quantity of soda supplied

A) increases from 0 cans to 4,000 cans a day. B) decreases from 4,000 cans to 0 cans a day. C) remains unchanged because the supply increases not the quantity supplied. D) increases from 0 to 6,000 cans a day. E) remains unchanged because the supply decreases not the quantity supplied.