Reading 24: Money, the Price Level, and Inflation - LOS i ～ class, quantity, states, black, money

mayanfang1

Q1. The quantity theory of money states that:

A)  money supply multiplied by velocity equals real output.

B)  an increase in the money supply will cause a proportional increase in prices.

C)  a decrease in the money supply will cause a proportional increase in prices.

Q2. Which of the following statements is least accurate? According to the quantity theory of money:

A)  velocity and real output are not determined by the money supply.

B)  velocity is determined by institutional factors.

C)  the price level is equal to the quantity of output divided by the money supply.

Q3. Which of the following relationships in regard to the equation of exchange is least accurate?

A)  Nominal GDP = Price × Money Supply.

B)  Money × Velocity = Money Supply × Velocity.

C)  Nominal GDP = Money Supply × Velocity = Price × Real Output.

Q4. Which of the following is the most accurate definition of the velocity of money? The velocity of money is the:

A)  GDP of a country divided by its price level.

B)  GDP of a country divided by its money supply.

C)  money supply of a country divided by its price level.

 

kinan

thx

hnzjbenson

 xq

jingh1981

THX

xwsh0325

d

seraphiris0116

thanks

leey52

nice

 

yamimiyato

4

danforth

d

0939

[em50]