The quantity theory of money ________.
A)is the product of classical economists
B)links total income to a country's supply of money
C)is derived from the equation of exchange
D)all of the above
E)none of the above

Question

Quizplus · Accepted Answer

The quantity theory of money is a product of classical economists and links total income to a country's supply of money. It is derived from the equation of exchange, which states that the money supply multiplied by the velocity of money (how quickly it circulates through the economy) equals the price level multiplied by the number of transactions or GDP. Therefore, D is the correct answer.

The Quantity Theory of Money ________