A Key Assumption in the Quantity Theory of Money Is

question 31

Multiple Choice

A key assumption in the quantity theory of money is that

• A)The supply of money is increasing at a constant rate
• B) The price level is stable over long periods of time
• C)The level of output of goods and services changes frequently in response to changes in velocity
• D)The velocity of money is constant
• E)None of the above

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Definitions:

Competition

The rivalry among businesses for consumers’ dollars.

Intrapreneurs

Individuals in large firms who take responsibility for the development of innovations within the organizations.

Stock

Shares of a corporation that may be bought or sold.