Monetarists accept the idea that velocity is not constant; nonetheless, they believe that it is highly:
A) variable.
B) unpredictable, ill-behaved, and independent of money supply.
C) unpredictable, well-behaved, and dependent of money supply.
D) predictable.

Question

Quizplus · Accepted Answer

Monetarists, such as Milton Friedman, argue that while the velocity of money (the rate at which money changes hands) is not constant, it is predictable over the long term. This predictability allows for the use of monetary policy based on changes in the money supply to control economic variables like inflation.

Monetarists Accept the Idea That Velocity Is Not Constant; Nonetheless