The Quantity Theory of Money States That

Multiple Choice

The quantity theory of money states that

A) MV = PY
B) since velocity is reasonably stable,we can predict the effects of an increase in the money supply on nominal income
C) since velocity is not stable,changes in the money supply have unpredictable impacts on income
D) since velocity is reasonably stable,we can predict the effects of an increase in the money supply on employment
E) since velocity is reasonably stable,we can predict the effects of an increase in the money supply on interest rates