Which of the Following Statements Is Consistent with the Quantity

question 125

Multiple Choice

Which of the following statements is consistent with the quantity theory of money?

• A)Monetary policy should be used in the short run to try to steer the economy.
• B)The money supply should be increased by a percentage to allow for changes in productivity and growth, but that percentage cannot be determined.
• C)Expansionary monetary policy is the only way to prevent a mild recession from developing into a serious recession or depression.
• D)A prescribed monetary policy should be followed regardless of what's happening in the economy.