Multiple Choice
According to the assumptions of the quantity theory of money,if the money supply increases 5 percent,then
A) both the price level and nominal GDP would rise by 5 percent.
B) the price level would rise by 5 percent and nominal GDP would be unchanged.
C) the price level would be unchanged and nominal GDP would rise by 5 percent.
D) both the price level and nominal GDP would be unchanged.
Correct Answer:
Verified
Correct Answer:
Verified
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