If a country's rules-based monetary policy sets the annual money supply growth rate equal to the average annual growth rate of Real GDP, and velocity is a constant, then the price level

A) is also constant.
B) rises in years when Real GDP rises.
C) rises in years when Real GDP growth is less than average.
D) rises in years when Real GDP growth is greater than average.


C

Economics

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Barriers to entry do not occur when:

a. economies of scale in production exist in an industry. b. firms requires a professional license or franchise agreement. c. the firm that introduces a product is granted a patent. d. a firm controls a scarce resource. e. diseconomies of scale in production exist in an industry.

Economics

When dealing with present value, a higher interest rate:

A. does not affect the present value of the future amount. B. decreases the present value of a future amount. C. increases the present value of a future amount. D. None of the statements associated with this question are correct.

Economics

Suppose that the current dividend for a stock is Dtoday, the expected dividend growth rate is r, and the interest rate is i. If we ignore risk, which of the following represents the dividend- discount model formula for the fundamental price of a stock?

A. Dtoday (1 + g) / (i - g) B. Dtoday / (i - g) C. Dtoday / (i + g) D. (i + g) / Dtoday

Economics

The fungibility of money means that

A. thinking large, one-time expenses should be paid off over a period of time, while everyday expenses should come out of your checking account, is irrational. B. people often create false distinctions between categories of debt. C. the categories people create to organize their expenditures are meaningless in financial terms. D. All of these statements are true.

Economics