In the Quantity Theory of Money,the Assumption That Aggregate Output

question 11

Multiple Choice

In the quantity theory of money,the assumption that aggregate output is fixed is based on the view that ________.

• A)wages and prices are perfectly flexible in the long run
• B)the velocity of money is constant in the short run
• C)the demand for real money balances is proportional to income
• D)changes in the quantity of money lead to proportional changes in the price level
• E)none of the above

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Definitions:

Online Journal

A digital periodical publication that can be accessed via the internet, covering various academic or specialized subjects.

Variance

A measure of the dispersion or spread of a set of data points, calculated as the average of the squared deviations from the mean.

Mean

A measure of central tendency that is calculated by adding up all the values in a set and then dividing by the number of values.

Standard Deviation

An appraisal of the diversity or spread level exhibited by a collection of figures.