The Quantity Theory of Money Assumes That

question 85

Multiple Choice

The quantity theory of money assumes that

• A)velocity varies inversely with interest rates.
• B)if velocity equals six, the Fed can increase nominal GDP by 30 percent if it increases the money supply by 5 percent.
• C)changes in the money supply affect output but not prices.
• D)changes in velocity are so small that velocity can be considered constant.

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Definitions:

Egophony

A change in the voice sound heard when auscultating the lungs with a stethoscope, often indicative of lung pathology.

Crepitus

A medical term used to describe the grating, crackling or popping sounds and sensations experienced under the skin and joints or a crackling sensation due to the presence of air in the subcutaneous tissue.

Acute Myocardial Infarction

A medical condition characterized by the sudden blockage of blood flow to a part of the heart, causing heart muscle damage or death, commonly known as a heart attack.

Pulmonic Stenosis

A heart valve disorder that involves narrowing of the pulmonary valve, leading to restricted blood flow from the right ventricle to the pulmonary artery.