The Quantity Theory of Money Implies That the Price Level

question 141

Multiple Choice

The quantity theory of money implies that the price level will be stable (no inflation or deflation) when the growth rate of the money supply equals

• A)0.
• B)the growth rate of the price level.
• C)the growth rate of the velocity of money.
• D)the growth rate of real GDP.

---

Definitions:

Increasing Amounts

A term referring to any situation or parameter that is continuously growing or becoming greater in number, size, value, or volume.

Drug

A substance that has a physiological effect when ingested or otherwise introduced into the body, often used for medicinal purposes.

Gamma Aminobutyric Acid (GABA)

A neurotransmitter in the brain that plays a key role in regulating neural excitability and anxiety.

Neurotransmitter

Chemicals in the nervous system that transmit signals across a synapse from one neuron to another, influencing various functions such as mood and behavior.