According to the quantity theory of money, in the long run
According to the quantity theory of money, in the long run
A. an increase in the quantity of money creates an increase in real GDP
B. the quantity of money in a society will always be just the right amount.
C. an increase in the quantity of money creates an increase in prices but no additional increase in real GDP
D. None of the above answers are correct.
Homework Answers
In the long run the output is constant I.e. it will not change the change in the supply of money in the market will only change the price level that is cause an inflation or deflation in the market.
the answer is "C".
Answer
Option 3
in the long run there is no change in the real GDP because of
change in money as the long-run output depends on all the available
resources and technology in the economy.
the increase in the money increases AD and shifts AD to right but
the LRAS is vertical so the increase in AD only increases the price
level.
QUESTION 10 According to the quantity theory of money, if the money supply, M, increases by...
QUESTION 10 According to the quantity theory of money, if the money supply, M, increases by 10%, then A. velocity increases by 10%. B. the rate of inflation (in %) increases by 10. C. the nominal GDP increases by 10%. D. none of the above. 10 points QUESTION 11 According to the quantity theory of money and the classical model, changes in nominal money supply, M, has A. no effect on real variables. B. no effect on inflation rate....
QUESTION 5 According to the quantity theory of money, a 10% increase in the quantity of...
QUESTION 5 According to the quantity theory of money, a 10% increase in the quantity of money ultimately leads to a 10% increase in __________. a. disposable income b. real GDP c. unemployment rate d. the price level
The quantity theory of money _____ A. focuses mainly on the close link between short run...
The quantity theory of money _____ A. focuses mainly on the close link between short run fluctuations in velocity and the price level B. works very well for the U.S. but it does not hold empirically for the other countries in the long run C. provides a long run theory of inflation because it is based on the assumption that prices and wages are fully flexible D. all of the above E. none of the above
38. According to the quantity theory of money, the inflation rate equals A) money supply minus...
38. According to the quantity theory of money, the inflation rate equals A) money supply minus real GDP. 8) the growth rate of the money supply minus the growth rate of real GDP, C) real GDP minus the money supply. D) the growth rate of real GDP minus the growth rate of the money supply of money pre rate than reacop. A) money supporowing at a fidower rate the 39. The quantity theory of money predicts that in the long...
According to the quantity theory of money, when the money supply doubles, which of the following...
According to the quantity theory of money, when the money supply doubles, which of the following variables doubles? a. The real interest rate. b. The velocity of money. c. The price level. d. The real GDP
9. What does the evidence from hyperinflations indicate with respect to the quantity theory of money?...
9. What does the evidence from hyperinflations indicate with respect to the quantity theory of money? (1 mark) a. Evidence shows that money growth and inflation moved together, which supports the quantity theory. b. Evidence shows that money growth and inflation moved together, which does not support the quantity theory. c. Evidence shows that money growth and inflation did not move closely with each other, which supports the quantity theory. d. Evidence shows that money growth and inflation did not...
According to the Purchasing Power Parity Theorem and the Quantity Theory of Money, other things being...
According to the Purchasing Power Parity Theorem and the Quantity Theory of Money, other things being equal, which of the following would cause the price of UK pound (r = US$/UKpound) to fall: a) A decrease in U.S. real GDP b) A decrease U.K. inflation rate c) An increase in U.S. inflation rate d) A decrease in U.S. money supply e) a decrease in UK money supply
According to the quantity theory of money, if aggregate spending in an economy increases by 3%...
According to the quantity theory of money, if aggregate spending in an economy increases by 3% and real GDP increases by 1%, we also know that there is: Group of answer choices a. a positive supply shock. b.a recession. c. inflation d. a war.
the quantity theory of money is QUESTION 35 The quantity theory of money is likely to...
the quantity theory of money is
QUESTION 35 The quantity theory of money is likely to hold in the short run. no longer holds for high-inflation countries. is likely to hold in the long run. always holds for high-inflation countries.
4. Money growth and inflation. Use the quantity theory of money to answer the following questions...
4. Money growth and inflation. Use the quantity theory of money to answer the following questions (a) (3 points) Assuming that the velocity of money is constant, if a country has an average annual growth rate of real GDP equal to 6%, then what is the average annual rate of money growth that would required to produce an average rate of inflation of 3%? Show your work. (b) (3 points) True or false: According to the quantity theory of money,...
38. According to the quantity theory of money, the inflation rate equals A) money supply minus real GDP. 8) the growth rate of the money supply minus the growth rate of real GDP, C) real GDP minus the money supply. D) the growth rate of real GDP minus the growth rate of the money supply of money pre rate than reacop. A) money supporowing at a fidower rate the 39. The quantity theory of money predicts that in the long...
the quantity theory of money is
QUESTION 35 The quantity theory of money is likely to hold in the short run. no longer holds for high-inflation countries. is likely to hold in the long run. always holds for high-inflation countries.
4. Money growth and inflation. Use the quantity theory of money to answer the following questions (a) (3 points) Assuming that the velocity of money is constant, if a country has an average annual growth rate of real GDP equal to 6%, then what is the average annual rate of money growth that would required to produce an average rate of inflation of 3%? Show your work. (b) (3 points) True or false: According to the quantity theory of money,...
Most questions answered within 3 hours.
-
Theres a 3kg block placed halfway on a 10m ramp with a slope of
17 deg....
asked 13 seconds ago -
A cyclotron is used to produce a beam of high-energy deuterons
that then collide with a...
asked 9 minutes ago -
If Smoking Generates External Costs, Should Smoking
Simply be Outlawed? How about Cars that Pollute?
asked 7 minutes ago -
For the reaction
2H2O(g)−⇀↽−2H2(g)+O2(g)2H2O(g)↽−−⇀2H2(g)+O2(g)
the equilibrium
concentrations were found to be [H2O]=0.250 M,[H2O]=0.250 M,
[H2]=0.490 M,[H2]=0.490...
asked 7 minutes ago -
Looking at market data, you find out that the current risk-free
rate is 3.9%, the expected...
asked 17 minutes ago -
C LANGUAGE!!!
The program uses both files and two dimensional arrays.
The Problem Statement
Business is...
asked 22 minutes ago -
A 2.912 g sample of a compounds containing only C, H, and O was
completely oxidized...
asked 19 minutes ago -
Consider a variation of Merge sort called 4-way Merge sort.
Instead of splitting the array into...
asked 22 minutes ago -
Suppose that Jason manages a risky portfolio with an expected
return of 15% and a standard...
asked 25 minutes ago -
The
price for product A increases from $20 to $23. The quantity
demanded for product B...
asked 26 minutes ago -
The rate constant for this second‑order reaction is 0.300
M−1⋅s−1
at 300 degrees C.
A⟶products
How...
asked 29 minutes ago -
3. United airlines fares from Chicago to New York is as
follows:
Mon Tue Wed Thurs...
asked 47 minutes ago