Monetarists Argue That

question 63

Multiple Choice

Monetarists argue that

• A) the Federal Reserve System should institute a prescribed rate of growth in the money supply.
• B) since velocity is unstable, a fixed annual increase in the money supply will exacerbate inflation in the long run.
• C) self-correction is less effective than activist monetary policy.
• D) policymakers should use monetary policy rather than fiscal policy to stabilize the economy.

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Definitions:

Post Reference Notation

A notation in a ledger to indicate the source of each entry, facilitating the traceability and verification of transactions.

Ledger

A book or electronic record used to record all of a company's financial transactions in accounts.

Ledger

A book or collection of financial accounts where transactions are recorded, typically categorized by type.

Journal

A book or digital record where all financial transactions are initially recorded, also known as the book of first entry.