The observation that the money supply is procyclical and leading the level of aggregate economic activity is most closely associated with
A) Lucas and Friedman.
B) Friedman and Schwartz.
C) Kydland and Prescott.
D) David Runkle.
E) Keynes.

Question

Quizplus · Accepted Answer

The observation that the money supply is procyclical and leading the level of aggregate economic activity is most closely associated with the work of Milton Friedman and Anna Schwartz in their book "A Monetary History of the United States." They argue that changes in the money supply have a significant impact on economic activity and that the Federal Reserve has the ability to influence economic outcomes through its control of the money supply.

The Observation That the Money Supply Is Procyclical and Leading