The Quantity Theory of Money States That in the Long

question 227

Multiple Choice

The quantity theory of money states that in the long run

• A) an increase in the quantity of money increases real GDP by a smaller percentage.
• B) the price level will not consistently rise, it will fluctuate.
• C) a rise in the price level rises causes the quantity of money to increase.
• D) an increase in the quantity of money results in an equal percentage increase in the price level.

---

Definitions:

Semelparous

Having a single reproductive effort in a lifetime.

Iteroparous

Having repeated reproductive cycles throughout a lifetime. Compare with semelparous.

Density-Dependent Factor

An environmental factor whose effects on a population change as population density changes; tends to retard population growth as population density increases and enhance population growth as population density decreases. Compare with density-independent factor.

Negative Feedback

A regulatory mechanism in which a stimulus causes an opposite output in order to maintain an ideal level of whatever is being regulated.