Friedman and Schwarz Argue That Money Is Not Neutral Because

question 93

Multiple Choice

Friedman and Schwarz argue that money is not neutral because

• A)theoretical models of the economy don't show monetary neutrality.
• B)money is a leading, procyclical variable.
• C)they found several historical incidents in which changes in the money supply were not responses to macroeconomic conditions, and output moved in the same direction as money.
• D)they found no evidence that productivity changes or changes in government spending contributed to business cycles; only monetary changes preceded every recession.

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