It Has Been Shown That Increases in the Money Supply

question 96

Multiple Choice

It has been shown that increases in the money supply are directly related to the rate of inflation.If the previous statement is true,then

• A) nations that increase their money supplies most rapidly will be the most prosperous.
• B) hyperinflation will normally be associated with large increases in the money supply.
• C) hyperinflation will normally be associated with large decreases in the money supply.
• D) menu costs will rise when the money supply falls.
• E) real wages rise whenever the money supply increases.

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