From the equation of exchange, if both real income (Y) and the quantity of money (M) double and the price level (P) remains constant, then velocity (V) ________ and nominal income ________
A) remains constant; doubles
B) doubles; remains constant
C) doubles; doubles
D) decreases by 50 percent; quadruples
E) none of the above
A
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Less developed countries, compared to industrialized ones, are more likely to have higher tariff rates.
Indicate whether the statement is true or false.
If the real interest rate falls, there is
A) a leftward shift of the supply of loanable funds curve and no shift in the demand for loanable funds curve. B) an upward movement along the supply of loanable funds curve. C) a downward movement along the supply of loanable funds curve. D) a rightward shift of the supply curve of loanable funds and no shift in the demand for loanable funds curve. E) a leftward shift of the supply of loanable funds curve and a rightward shift in the demand for loanable funds curve.
If households have information that monetary policy is likely to change in the future, that information will play a role in forming ________
A) adaptive expectations B) rational expectations C) tertiary expectations D) non-adaptive expectations
In the long run
A) fixed costs tend to be greater than variable costs. B) variable costs tend to be greater than fixed costs. C) all costs are fixed costs. D) all costs are variable costs.