If Long-Run Real GDP Growth Is Determined by Real Changes

question 62

Multiple Choice

If long-run real GDP growth is determined by real changes in the economy, the quantity theory of money implies that changes in:

• A) the money growth rate lead one-for-one to changes in the inflation rate in the long run.
• B) the money growth rate lead one-for-one to changes in the inflation rate, but only in the short run.
• C) velocity lead one-for-one to changes in the inflation rate.
• D) the money growth rate lead to a greater than one-for-one change in the inflation rate in the long run.
• E) None of these answers is correct.

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Definitions:

Semantic Groups

Clusters of words that are related in meaning, often used in the study of language and cognition to understand how meaning is structured.

Human Characteristic

Traits or features that are inherently part of being human, including biological, psychological, and social attributes.

Schooling

The process of receiving formal education, typically in an institutional setting such as a school.

Priming Method

A technique in psychology used to train people's memory both in positive and negative ways by presenting them with information that influences their subsequent actions or responses.