Multiple Choice
Which of the following is TRUE regarding the monetarist theory of the business cycle?
I. Monetarists assume that the quantity of money increases at a constant rate.
II. Fluctuations in interest rates cause business cycles.
III. Changes in the growth rate of the quantity of money affect aggregate demand.
A) I only
B) III only
C) I and II
D) II and III
Correct Answer:
Verified
Correct Answer:
Verified
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