If Velocity Is Growing by 2 Percent Per Year and Real

question 44

Multiple Choice

If velocity is growing by 2 percent per year and real output is growing 6 percent per year, according to the equation of exchange, in order to maintain stable prices, the money supply would have to:

• A)​grow by 3 percent.
• B)​grow by 4 percent.
• C)​grow by 8 percent.
• D)​grow by 12 percent.

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