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When We Assume That the Supply of Money Is a Variable

Question 72

Multiple Choice

When we assume that the supply of money is a variable that the central bank controls,we


A) must then assume as well that the demand for money is not influenced by the value of money.
B) must then assume as well that the price level is unrelated to the value of money.
C) are ignoring the fact that,in the real world,households are also suppliers of money.
D) are ignoring the complications introduced by the role of the banking system.

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