Author Question: If real GDP grows at 3 percent a year, the quantity of money grows at 5 percent a year, and the ... (Read 98 times)

cartlidgeashley · **on:** Jun 29, 2018

If real GDP grows at 3 percent a year, the quantity of money grows at 5 percent a year, and the velocity of circulation is constant, then the price level must be

A) increasing at 8 percent a year.
B) decreasing at 2 percent a year.
C) increasing at 15 percent a year.
D) increasing at 2 percent a year.
E) decreasing at 8 percent a year.

Question 2

The above table gives data for the nation of Mouseville. There are no imports into or exports from Mouseville. The equilibrium level of real GDP is

A) 700 billion. B) 500 billion. C) 800 billion. D) 900 billion. E) 100 billion.