The quantity theory of money seeks to explain the connection between money and
A)interest rates.
B)unemployment.
C)output.
D)prices.

Question

Quizplus · Accepted Answer

The quantity theory of money states that there is a direct relationship between the quantity of money in circulation and the level of prices. In other words, an increase in the supply of money will lead to higher prices, while a decrease in the supply of money will lead to lower prices.

The Quantity Theory of Money Seeks to Explain the Connection