According to the quantity theory, in the long run, an increase in the growth rate of ________ leads to an increase in the ________.
A) real GDP; inflation rate
B) the quantity of money; growth rate of real GDP
C) the quantity of money; inflation rate
D) real GDP; growth rate of velocity

Question

Quizplus · Accepted Answer

The quantity theory of money suggests that in the long run, an increase in the growth rate of the quantity of money leads to an increase in the inflation rate, as more money chases the same amount of goods and services.

According to the Quantity Theory, in the Long Run, an Increase