The Quantity Theory of Money Assumes That the Velocity of Money

question 206

Multiple Choice

The quantity theory of money assumes that the velocity of money:

• A) is constant.
• B) will rise if the money supply rises and fall if the money supply falls.
• C) will rise if the money supply rises, but it will not change if the money supply falls.
• D) will fall if the money supply rises, and it will rise if the money supply falls.
• E) will fall if the money supply rises, but it will not change if the money supply falls.

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