# answering multiple choice questions 1

I’ll put the rest of the questions here

19) the quantity theory of money predicts that, in the long run, inflations results from the:

a) velocity of money growing at a faster rate than real GDP

b) velocity of money growing at a lower rate than real GDP

c) money supply growing at a lower rate than real GDP

d) money supply growing at a faster rate than real GDP

20) according to the quantity theory of money, if the money supply grows at 20n percent and real GDP grows at 5 percent, then the inflation rate will be:

a) 15%

b) 20%

c) 25%

d) 100%

21) using the quantity equation, if the velocity of money grows at 5 percent, the money supply grows at 10 percent, and real GDP grows at 4 percent, then the inflation rate will be:

a) 19%

b) 15%

c) 11%

d) 6%

22) the quantity theory of money implies that the price level will be stable (no inflation or deflation) when the growth rate of the money supply equals:

a) 0

b) the growth rate of the price level

c) the growth rate of the velocity of money

d) the growth rate of real GDP