According to the Quantity Theory of Money Currently Used by Monetarists

question 86

Multiple Choice

According to the quantity theory of money currently used by monetarists, assuming velocity is constant (at a value of 5) , a 10 percent increase in the money supply will raise

• A)nominal GDP by 50 percent.
• B)real GDP by 10 percent.
• C)nominal GDP by 10 percent.
• D)real GDP by 50 percent.

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Definitions:

Article 4

Typically refers to a specific section within a constitution, treaty, or document that outlines particular rights, responsibilities, or regulations.

Postdated Checks

Checks written with a date in the future, indicating that the check should not be processed until that date.

Drawee Bank

The financial institution upon which a check is drawn, responsible for paying the amount specified when the check is presented.

Drawer-Drawee Relationship

The financial interaction where the drawer writes a check and the drawee bank or financial institution pays the amount.