Which Statement About the Classical Money Transmission Mechanism Is FALSE

Multiple Choice

Which statement about the classical money transmission mechanism is FALSE?

A) The quantity theory provides a good explanation of the short-run impact of monetary growth.
B) The quantity theory provides a good explanation of the long-run impact of monetary growth.
C) Changes in the money supply typically affect prices before equilibrium can be reestablished.
D) People typically respond to money supply changes by making more or fewer purchases of goods and services.