Which of the Following Is an Assumption Used by Monetarists

question 8

Multiple Choice

Which of the following is an assumption used by monetarists in establishing the quantity theory of money?

• A) real GDP is equal to the multiplicative product of the money supply and the price level
• B) the velocity of money is constant
• C) households exhibit rational expectations
• D) households exhibit money illusion
• E) all of the above

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