Answered

Discover new information and get your questions answered with IDNLearn.com. Discover comprehensive answers to your questions from our community of knowledgeable experts.

To explain the long-run determinants of the price level and the inflation rate, most economists today rely on the

A. quantity theory of money.
B. price-index theory of money.
C. theory of hyperinflation.
D. disequilibrium theory of money and inflation.

Sagot :

GinnyAnsweridn

Final answer:

The quantity theory of money explains the long-run determinants of the price level and inflation rate, highlighting the relationship between money supply and inflation.


Explanation:

The long-run determinants of the price level and inflation rate are often explained using the quantity theory of money. This theory suggests that in the long run, inflation is dependent on the money supply. An increase in the money supply leads to a proportional increase in the price level, indicating a direct relationship between the two.


Learn more about Quantity Theory of Money here:

https://brainly.com/question/30764983


Your engagement is important to us. Keep sharing your knowledge and experiences. Let's create a learning environment that is both enjoyable and beneficial. Thanks for visiting IDNLearn.com. We’re dedicated to providing clear answers, so visit us again for more helpful information.