An Assumption Used in the Quantity Theory of Money Is

question 34

Multiple Choice

An assumption used in the quantity theory of money is that

• A) the price level is constant.
• B) velocity is constant.
• C) nominal Gross Domestic Product (GDP) is constant.
• D) the money supply is constant.

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Definitions:

Hourly Wage Rate

The hourly wage rate is the amount of money paid to an employee for each hour of work performed.

Note Payable

A written agreement where one party promises to pay another party a specific sum of money on a certain date or upon demand.

Interest-Bearing Note

This is a debt instrument that pays interest to the holder at a fixed or variable rate until the maturity date or repayment of the principal amount.

Contingent Liabilities

Potential obligations that may arise depending on the outcome of a future event.