The hypothesis that changes in the money supply lead to proportional changes in the price level is called
A) the equation of exchange.
B) the Keynesian multiplier.
C) the theory of empirical relativity.
D) the quantity theory of money and prices.
D
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Which of the following statements is true?
A) Rational economic agents maximize more than just monetary income. B) It is not necessary to consider the risks of a particular alternative while making an optimal decision. C) An individual does not require information to make optimal decisions. D) The principle of optimization is only accurate when it comes to making monetary decisions.
A fall in the real interest rate
A) results in a movement along the demand for loanable funds curve. B) shifts the demand for loanable funds curve rightward. C) shifts the demand for loanable funds curve leftward. D) has no effect on the demand for loanable funds curve
A nominal anchor helps policy makers to avoid ________
A) adaptive expectations B) constrained discretion C) negative demand shocks D) the time-inconsistency problem
Which of the following is not an example of a fungible commodity?
A. Wheat B. Electricity C. Money D. All of these are fungible commodities.