Which of the Following Is FALSE

question 7

Multiple Choice

Which of the following is FALSE?

• A)in the short run, the rate of monetary growth and the rate of inflation always follow the same pattern
• B)in the short run, a change in the growth rate of money can affect the level of output
• C)in the short run, factors other than an increase in the growth rate of money can cause inflation to increase
• D)in the long run, a sustained increase in the growth rate of money will cause the inflation rate to increase
• E)in the long run, a sustained increase in the growth rate of money will have no effect on the level of output

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Definitions:

Wage Rate

The standard amount of compensation that employees receive in exchange for performing a specific task or job per time period.

Substitution Effect

The adjustment in purchasing behaviors as a result of variations in the comparative costs of products, prompting buyers to switch from one item to another that is either cheaper or more costly.

Output Effect

The impact on economic output and productivity resulting from a change in the level of economic activity.

Wage Rate

The amount of money paid to workers per unit of time, often hourly or monthly, for their labor.