According to the Assumptions of the Quantity Theory of Money,if

question 91

Multiple Choice

According to the assumptions of the quantity theory of money,if the money supply increases by 5 percent,then

• A)nominal and real GDP would rise by 5 percent.
• B)nominal GDP would rise by 5 percent;real GDP would be unchanged.
• C)nominal GDP would be unchanged;real GDP would rise by 5 percent.
• D)neither nominal GDP nor real GDP would change.

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Definitions:

Unequal Income Distribution

A situation where income is distributed unevenly among a population, leading to disparities in wealth and living standards.

Developed Countries

Nations with relatively high levels of economic prosperity and standards of living, often characterized by high Gross Domestic Product (GDP) per capita.

Income Inequality

The unequal distribution of income within a population, often measured by various statistical means, indicating the gap between the rich and the poor.

Developed Countries

Nations with high levels of industrialization, a higher standard of living, advanced technological infrastructure, and more complex economic systems compared to developing countries.