If the Money Supply Increases by 10%, in the Long

question 68

Multiple Choice

If the money supply increases by 10%, in the long run:

• A) unemployment drops by 10%.
• B) the price level increases by 10%.
• C) real GDP increases by 10%.
• D) unemployment drops by 20%.

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Definitions:

Ideal

A concept or standard of perfection that is aspired to; often used in the context of goals, values, or qualities that are deemed to be the most desirable.

Ought

A term expressing duty, correctness, or moral obligation, indicating what should be done.

Self-assessment

The process of evaluating one's own thoughts, feelings, behaviors, and abilities, often in relation to personal goals or standards.

Psychology

The science that studies behavior and the physiological and mental processes that underlie it and the profession that applies the accumulated knowledge of this science to practical problems.