Assume Nominal Money Supply Grows by 6% and Real GDP

question 34

Multiple Choice

Assume nominal money supply grows by 6% and real GDP grows by 4%.We can conclude that the rate of inflation is about

• A)+6%
• B)+2%
• C)+6% minus the percentage change in velocity
• D)+2% minus the percentage change in velocity
• E)+2% plus the percentage change in velocity

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Definitions:

Cretinism

A condition of severely stunted physical and mental growth due to untreated congenital deficiency of thyroid hormones.

Hypothalamus

A region of the brain that controls a variety of functions including temperature, hunger, and hormonal balance.

Prolactin

A hormone produced by the anterior pituitary gland, which plays a role in lactation, reproductive functions, and the immune system.

Anterior Lobe

The front portion of the pituitary gland, responsible for releasing hormones that regulate various bodily functions.