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If the Rate of Growth in Real GDP Exceeds the Rate

question 21

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If the rate of growth in real GDP exceeds the rate of growth in the money supply,the quantity theory of money predicts a price deflation.


Definitions:

Unionization Rates

The percentage of workers in a particular labor market or industry that are members of labor unions.

Nominal Wage

The amount of money paid to a worker per unit of time, measured in current currency terms without adjustment for inflation.

Price Level

A general measure of current prices for every type of good or service created in the economy.

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