According to the Classical Dichotomy,when the Money Supply Doubles,which of the Following

question 193

Multiple Choice

According to the classical dichotomy,when the money supply doubles,which of the following also doubles?

• A)the price level and nominal wages
• B)the price level,but not the nominal wage
• C)the nominal wage,but not the price level
• D)neither the nominal wage nor the price level

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Definitions:

Mandatorily Redeemable

Financial instruments or securities that the issuer is obligated to buy back or redeem at a predetermined price and date.

Equity

Equity refers to the ownership interest held by shareholders in a corporation, represented by their shares of the company's stock.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, usually with fixed dividends.

Financially Weak

Refers to a state where a company or an individual has poor financial health, often indicated by low liquidity, high debt, or difficulty in generating income.