Which of the Following Predictions Can Be Made Using the Growth

question 5

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 the growth rate in Y_P exceeds the money growth rate, there will be inflation.
• B) If the money growth rate is less than the growth rate in Y_P, there will be deflation.
• C) If the money supply grows at the same rate as growth in Y_P, the price level will grow at a constant rate.
• D) If the money supply grows at the same rate as growth in Y_P, the price level will also increase at the same rate as growth in Y_P.

---

Definitions:

Positive Image

A favorable impression or perception of a person, organization, or concept by the public or a specific group.

African Americans

Refers to citizens or residents of the United States who have total or significant partial ancestry from any of the black racial groups of Africa.

Mainstream U.S. Media

Media outlets and organizations that are widely recognized and consumed by the majority of the American public, often representing dominant cultural and social narratives.

Racial Groups

Categories of people who are identified or classify themselves based on physical characteristics, ancestry, or social identity.