The Policy Rule Recommended by Monetarists Is That the Money

question 51

Multiple Choice

The policy rule recommended by monetarists is that the money supply should be increased at the same rate as the potential growth in

• A) real GDP.
• B) population.
• C) the level of prices.
• D) the velocity of money.

---

Definitions:

Productive Contribution

The input or service provided by a factor of production towards the making of goods and services.

Corporate Form

A legal structure for businesses recognized as separate entities from their owners, providing limited liability protection and enabling easier access to capital.

Cost Efficient

Achieving a specific goal or output with minimum expense or least waste.

Economic Profit

The discrepancy between sum revenue and sum expenses, taking into account both acknowledged and assumed costs.