Author Question: According to the quantity theory of money, if an economy produces 100 units of output and has a ... (Read 13 times)

bobthebuilder · **on:** Jun 30, 2018

According to the quantity theory of money, if an economy produces 100 units of output and has a money supply equal to 500, then if the money supply doubles while velocity remains constant, the new price level will:
a. fall to half its initial level.
b. fall, but it will not fall all the way to half its initial level.
c. increase, but it will not double.
d. double.
e. more than double.

Question 2

Cyclical unemployment is caused by:
a. shifts in the structure of the economy.
b. seasonal layoffs.
c. declines in actual output below its full-employment level.
d. the absence of job skills among the unemployed.