Multiple Choice
If the velocity of money increases from 5 percent and real GDP increases 3 percent,what will the Bank of Canada need to do keep prices the same?
A) They would have to decrease the money supply by 8 percent.
B) They would have to decrease the money supply by 2 percent.
C) They would have to increase the money supply by 2 percent.
D) They would have to increase the money supply by 8 percent.
Correct Answer:
Verified
Correct Answer:
Verified
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