According to the Quantity Theory, in the Long Run, an Increase

question 551

Multiple Choice

According to the quantity theory, in the long run, an increase in the growth rate of leads to an increase in the ________.

• A) the quantity of money; growth rate of real GDP
• B) real GDP; inflation rate
• C) real GDP; growth rate of velocity
• D) the quantity of money; inflation rate

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Definitions:

P(A and B)

The probability of both event A and event B occurring in a joint probability distribution.

Independent Events

Events whose occurrence or outcome does not influence the occurrence or outcome of another event.

Conditional Probability

The probability of an event occurring, given that another event has already occurred.

P(A|B)

The probability of event A occurring given that event B has already occurred.