The Proposition of Long-Run Neutrality of Money Is Supported by Evidence

question 104

Multiple Choice

The proposition of long-run neutrality of money is supported by evidence over more than fifty years and many countries that there is a positive relationship between

• A)money supply growth and real GDP.
• B)money supply growth and interest rates.
• C)potential GDP and money supply growth.
• D)inflation rates and interest rates.
• E)inflation rates and money supply growth.

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Definitions:

Return

Refers to the income generated from an investment, including dividends, interest, or capital gains, expressed usually as a percentage.

Investment

The act of allocating resources, usually money, with the expectation of generating an income or profit.

Exit Strategy

A plan developed by an investor, entrepreneur, or business owner to sell their stake in a company to realize their profits or minimize losses.

Venture Capital

Financing that is provided by investors to startup companies and small businesses with perceived long-term growth potential.