According to the quantity theory of money, if the velocity of money is stable or at least predictable, then the equation of exchange can be used to predict the effects of changes in the money supply on nominal GDP
Indicate whether the statement is true or false
true
You might also like to view...
Refer to Table 20.1. The income tax in Oceania is
A) progressive. B) regressive. C) proportional. D) a flat tax.
At Albert's Pretzel Company, MPL = 1/L, and MPK = 1/K. The isoquant for 100 pounds of pretzels daily is shown in the above figure
Albert minimizes the cost of producing 100 pounds of pretzels daily by hiring 5 units of labor and 10 units of capital when w = 50 and r = 25. When r rises to 100, what is the minimum cost of producing 100 pounds of pretzels daily in the short run? in the long run?
A Decrease in price will result in an increase in total revenue if:
a. the percentage change in quantity demanded is less than the percentage change in price. b. the percentage change in quantity demanded is greater than the percentage change in price. c. demand is inelastic. d. the consumer is operating along a linear demand curve at a point at which the price is very low and the quantity demanded is very high.
Unions often oppose increases in the prices of complementary inputs (for example, truck drivers may oppose increases in taxes on diesel fuel). They do this because increases in the prices of complementary inputs might:
A. increase the supply of competing labor through the output effect. B. increase the supply of competing labor through the substitution effect. C. decrease the demand for union labor through the output effect. D. decrease the demand for union labor through the substitution effect.