The Main Idea Behind Monetarism Is That

question 161

Multiple Choice

The main idea behind monetarism is that:

• A) the aggregate output will be even greater than potential output if the money supply grows at a constant rate.
• B) the aggregate price level will increase proportionally if the money supply grows at a constant rate.
• C) the government budget will have a deficit if the government spending grows at a constant rate.
• D) the aggregate output will grow steadily at a constant rate if the money supply also grows at a constant rate.

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Definitions:

Liability

The state of being legally responsible for something, particularly in the context of debts or legal judgments.

Contract

A legal commitment made between two or more participants that is upheld by law.

Breach

The violation of a law, duty, or other form of agreement.

Warranty

A guarantee provided by a manufacturer or seller regarding the condition of a product and the promise to repair or replace defective parts within a specified period.