According to the long-run relationship between money growth, income growth, and the change in the price level, if European inflation is higher than U.S. inflation but money growth is the same, it must be that: a) real income growth in Europe and the United States is the same. b) real income growth in Europe is larger than real income growth in the United States. c) real income growth in the United States is higher than in Europe. d) the level of nominal income is higher in Europe than in the United States.

According to the long-run relationship between money growth, income growth, and the change in the price level, if European inflation is higher than U.S. inflation but money growth is the same, it must be that: a) real income growth in Europe and the United States is the same. b) real income growth in Europe is larger than real income growth in the United States. c) real income growth in the United States is higher than in Europe. d) the level of nominal income is higher in Europe than in the United States.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter27: Issues In Macroeconomic Theory And Policy

Section: Chapter Questions

Problem 6P

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