If the Economy's Real Output Is Growing by 2

question 126

Multiple Choice

If the economy's real output is growing by 2.5 percent a year, then, in order to maintain price stability, a monetarist would most likely recommend that money supply should be

• A) held constant.
• B) decreased by 1 percent a year.
• C) increased by 2.5 percent a year.
• D) increased by 7.5 percent a year.

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Definitions:

Dermatome

An area of skin that is mainly supplied by a single spinal nerve.

Spinal Cord

The long, thin, tubular structure made up of nervous tissue, which extends from the medulla oblongata in the brainstem down the vertebral canal to the lower back, facilitating nerve impulses between the brain and the rest of the body.

Basal Ganglia

A group of structures linked to the thalamus in the base of the brain and involved in coordination of movement.

Forebrain

The anterior part of the brain, including the cerebral hemispheres, thalamus, and hypothalamus, involved in complex functions.