If the Price Level Doubles

question 4

Multiple Choice

If the price level doubles,

• A)the quantity demanded of money falls by half.
• B)the value of money is cut by half.
• C)nominal income is unaffected.
• D)None of these answers.
• E)the money supply has halved.

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Definitions:

May

The fifth month of the year in the Gregorian calendar.

Labor Efficiency Variance

The difference between the actual labor hours used in production and the standard hours expected, multiplied by the standard labor rate.

Labor Rate Variance

The difference between the actual hourly wage paid to workers and the standard or expected wage rate, multiplied by the total hours worked.

Standard Amount

A benchmark or norm set for the quantity or cost of inputs in producing a specific product or in carrying out a process.