In the Long Run, an Increase in the Quantity of Money

question 248

Multiple Choice

In the long run, an increase in the quantity of money:

• A) increases real output.
• B) increases prices but not long-run output.
• C) increases real interest rates.
• D) has no effect on the economy.

---

Definitions:

Behavioral Level

A perspective in psychology that focuses on observable behaviors and the ways in which they can be learned, measured, and modified.

Primacy Effect

The tendency to evaluate others in terms of first impressions.

Actor-Observer Effect

A psychological bias where people tend to attribute their own actions to situational factors while attributing others' actions to their personalities or character.

Fundamental Attribution Error

The tendency to overemphasize personality-based explanations for behaviors observed in others while underestimating the influence of external factors.