In the quantity theory of money, P and Y represent the price and quantity of:
A)all raw materials and natural resources sold in an economy
B)all financial services sold in an economy.
C)all durable capital (tractors, manufacturing equipment) purchased in the economy
D)all finished goods and services sold in an economy

Question

Quizplus · Accepted Answer

In the quantity theory of money, P represents the price level, and Y represents the real output or quantity of all finished goods and services sold in an economy, which together determine the nominal GDP.

In the Quantity Theory of Money, P and Y Represent