The real value of money ________ as the price level falls.
A) remains the same
B) decreases
C) increases
D) none of the above

Question

Quizplus · Accepted Answer

The real value of money increases as the price level falls. This is because a lower price level means that the currency can buy more goods and services, making it more valuable. Thus, C is the correct choice. A is incorrect because the value of money changes with the price level, and B is incorrect because a decrease in the price level increases the value of money. D is also incorrect because C is the correct answer.

The Real Value of Money ________ as the Price Level