Which of the Following Predictions Can Be Made Using the Growth

question 2

Multiple Choice

Which of the following predictions can be made using the growth rates associated with the equation of exchange, given that velocity is stable and that the economy moves to its potential output (Y_P) in the long run?

• A) If %∆M = %∆ Y_P , then %∆P = %∆M.
• B) If %∆M > %∆ Y_P , then %∆P > 0.
• C) If %∆M > %∆ Y_P , then %∆P > %∆M.
• D) If %∆M = %∆ Y_P , then %∆P < 0.

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Definitions:

Preferred Provider Organizations

Health care organizations that offer members discounted rates for medical care from a network of preferred providers, while still covering some costs for care outside the network.

Discounted Prices

Prices reduced from the original or list price, often to encourage prompt payment or bulk purchasing.

Fixed Amount

A specific sum that does not change over time or under varying circumstances.

Patient Protection And Affordable Care Act

A health care reform law enacted in 2010 aimed at expanding health insurance coverage and reducing the costs of healthcare for Americans.