Suppose an economy produces only ice cream cones. If the price level rises, the value of currency
A) Rises, because one unit of currency buys more ice cream cones.
B) Rises, because one unit of currency buys fewer ice cream cones.
C) Falls, because one unit of currency buys more ice cream cones.
D) Falls, because one unit of currency buys fewer ice cream cones.
Correct Answer:
Verified
Q2: Monetary neutrality means that a change in
Q3: If the money supply is €500, real
Q4: In the long run, inflation is caused
Q5: The term hyperinflation refers to
A) The spread
Q6: An increase in the price level is
Q8: The supply of money is determined by
A)
Q9: In the long run, the demand for
Q10: Economists agree that
A) Neither high inflation nor
Q11: The quantity theory of money concludes that
Q12: When prices rise at an extraordinarily fast
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