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The Difference Between the Equation of Exchange and the Quantity

Question 103

Multiple Choice

The difference between the equation of exchange and the quantity theory of money is that the


A) equation of exchange assumes that the level of real GDP is constant.
B) quantity theory of money assumes that the Fed has no control over the money supply.
C) equation of exchange assumes that the level of nominal GDP is constant.
D) quantity theory of money assumes that velocity is virtually constant.

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