Monetarists regard the rate of growth of the money supply as the principal determinant of nominal GDP.By nominal GDP,they mean GDP

Question

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Monetarists believe that changes in the money supply have a direct and proportional effect on changes in nominal GDP, which is GDP without adjusting for changes in the price level. This is because an increase in the money supply leads to an increase in spending, which in turn leads to an increase in nominal GDP.

Monetarists Regard the Rate of Growth of the Money Supply