Classical economists' belief in the "neutrality of money" led them to argue that
A) a change in the quantity of money would change the price level but would not change relative prices.
B) absolute prices were determined in the real part of the economy.
C) relative prices have no role in the real allocation of resources.
D) a change in the quantity of money would not affect money prices or relative prices.
E) the allocation of resources was determined by the quantity of money and not by the forces of supply and demand.
Correct Answer:
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Q47: An increase in the money supply sets
Q48: The economy's investment demand function describes the
A)positive
Q49: The term "demand for money" usually refers
Q50: The long- run neutrality of money implies
Q51: a reduction in the money supply.
A)2 only
B)1
Q53: Changes in the money supply in an
Q54: Monetary policy can have the largest impact
Q55: If the annual interest rate is 8
Q56: Which one of the following statements best
Q57: Monetary equilibrium occurs when the
A)the money supply
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