According to the quantity theory of money, if the money supply grows at 20 percent and real GDP grows at 5 percent, then the inflation rate will be

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According to the quantity theory of money, the equation for the inflation rate is MV = PY, where M is the money supply, V is the velocity of money, P is the price level, and Y is real GDP. Assuming that the velocity of money remains constant, if M grows by 20% and Y grows by 5%, then P must grow by 15% to satisfy the equation. Therefore, the inflation rate will be 15%.

According to the Quantity Theory of Money, If the Money