For a given value of real output,the real interest rate,and the expected inflation rate,the economy's price level depends on

Question

Quizplus · Accepted Answer

The price level is determined by the quantity of money in circulation. A higher nominal money supply will lead to an increase in the general price level, and a lower nominal money supply will cause prices to fall. Therefore, the real output, real interest rate, and expected inflation rate are insufficient to determine the price level, and the nominal money supply is critical.

For a Given Value of Real Output,the Real Interest Rate,and