If Real GDP Grows at 3 Percent a Year, the Quantity

question 46

Multiple Choice

If real GDP grows at 3 percent a year, the quantity of money grows at 5 percent a year, and the velocity of circulation is constant, then the price level must be

• A) increasing at 8 percent a year.
• B) decreasing at 8 percent a year.
• C) increasing at 2 percent a year.
• D) decreasing at 2 percent a year.
• E) increasing at 15 percent a year.

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Definitions:

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A comprehensive accounting software package developed by Intuit, designed for small to medium-sized businesses to manage payroll, inventory, sales, and other needs.

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