Multiple Choice
According to the quantity theory of money, if the monetary authorities allow the money supply to grow at a rate of 6 percent in an economy that is growing by 2 percent in real terms, then inflation will be:
A) 2 percent.
B) 4 percent.
C) 6 percent.
D) 8 percent.
Correct Answer:
Verified
Correct Answer:
Verified
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