Which of the Following Is True About the Classical Theory

question 106

Multiple Choice

Which of the following is true about the Classical theory and the Monetarist theory with Regards to the impact of changes in the money supply on the economy?

• A)Both the Classical theory and Monetarism conclude that changes in money supply affect real GDP in the short run and in the long run.
• B)Both the Classical theory and Monetarism conclude that changes in money supply do not affect real GDP in the short run but will affect real GDP in the long run.
• C)Both the Classical theory and Monetarism conclude that changes in money supply affect nominal GDP in the long run.
• D)Both the Classical theory and Monetarism conclude that changes in money supply affect nominal GDP in the short run and real GDP in the long run.

Understand the processes involved in memory activation, including the difference between short-term and long-term memory.

Explore the concept of regret and its relationship with actions and inactions over the lifespan.

Analyze the characteristics and consequences of fundamental attribution error in social perception.

Distinguish between entity and incremental mindsets and their implications for self-perception and performance.

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Definitions:

Short-Term Focus

An approach or strategy emphasizing immediate outcomes or benefits, often at the expense of long-term objectives.

Compensation Plans

Schemes or programs implemented by businesses to remunerate, incentivize, and reward their employees for their performance and contribution to the organization.

Shareholders' Incentives

Motivations or benefits, such as dividends or stock price appreciation, that encourage individuals or entities to invest in a company's shares.

Long-Term Business Goals

Strategic objectives a business intends to achieve over a long period, which guide decision-making and operations.