The principle that states that what matters to people is the real value or purchasing power of money is the
A) marginal principle.
B) principle of diminishing returns.
C) spillover principle.
D) real-nominal principle.

Question

Quizplus · Accepted Answer

The real-nominal principle states that what matters to people is the real value or purchasing power of money, not the nominal or face value of money. This principle is important in understanding inflation and how it affects people's purchasing power. The other options, such as marginal principle and principle of diminishing returns, are related to economics but do not specifically address the issue of the real value of money. The spillover principle is not a well-known economic principle.

The Principle That States That What Matters to People Is