If the Quantity Theory of Money is correct, then if velocity is constant and money supply incr be the case that the level of real GDP increases. inflation is constant. nominal interest rates must rise by more than inflation. O the level of nominal GDP increases.

If the Quantity Theory of Money is correct, then if velocity is constant and money supply incr be the case that the level of real GDP increases. inflation is constant. nominal interest rates must rise by more than inflation. O the level of nominal GDP increases.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter22: Money Growth And Inflation

Section: Chapter Questions

Problem 5CQQ

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Question

If the Quantity Theory of Money is correct, then if velocity is constant and money supply increases it must
be the case that
the level of real GDP increases.
inflation is constant.
nominal interest rates must rise by more than inflation.
O the level of nominal GDP increases.

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