Author Question: If velocity is growing by 2 percent per year and real output is growing 6 percent per year, ... (Read 122 times)

nramada · **on:** Jun 30, 2018

If velocity is growing by 2 percent per year and real output is growing 6 percent per year, according to the equation of exchange, in order to maintain stable prices, the money supply would have to:
a. grow by 3 percent.
b. grow by 4 percent.
c. grow by 8 percent.
d. grow by 12 percent.

Question 2

Producer surplus from a unit of output is the difference between the market price and the seller's cost of producing that unit.
a. True
b. False
Indicate whether the statement is true or false