The Quantity Theory of Money States That in the Long

question 141

Multiple Choice

The quantity theory of money states that in the long run

• A) the price level will not consistently rise, it will fluctuate.
• B) an increase in the quantity of money results in an equal percentage increase in the price level.
• C) a rise in the price level rises causes the quantity of money to increase.
• D) an increase in the quantity of money increases real GDP by a smaller percentage.

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Definitions:

Door-In-The-Face Technique

A compliance method whereby a large request is made knowing it will be refused so that a subsequent, smaller request is more likely to be accepted.

Large First Request

A persuasion technique where a more significant request is made initially, expected to be refused, followed by a smaller request, which seems more reasonable by comparison.

Social Norms

Unwritten rules that govern the behavior of individuals within a society or group, guiding what is considered acceptable or unacceptable behavior.

Cognitive Dissonance

The psychological discomfort experienced when holding two or more conflicting beliefs, values, or attitudes.