Most Economists Believe That in the Long Run,changes in the Money

question 18

Multiple Choice

Most economists believe that in the long run,changes in the money supply

• A)affect nominal but not real variables.This view that money is ultimately neutral is consistent with classical theory.
• B)affect nominal but not real variables.This view that money is ultimately neutral is inconsistent with classical theory.
• C)affect real but not nominal variables.This view that money is ultimately neutral is consistent with classical theory.
• D)affect real but not nominal variables.This view that money is ultimately neutral is inconsistent with classical theory.

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Definitions:

Economic Inefficiency

A situation where resources are not allocated optimally, leading to wastage or less than maximal output in an economy.

Food, Conservation, and Energy Act

U.S. legislation enacted in 2008 aimed at governing a wide range of agricultural and food policies, including crop insurance and nutritional programs.

Target Price

A pre-set price determined by a company or government at which a product, especially in agriculture, is aimed to be sold in the market.

Countercyclical Payment

A fiscal mechanism used to reduce the economic fluctuations by providing economic support during downturns and less support during growth periods.