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Macroeconomics

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Moderate

The Quantity Theory of Money: Nominal GDP Growth

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Suppose the nominal GDP of an economy was $\$120$ million last year and $\$125$ million this year. According to the Quantity Theory of Money the percentage change in the money supply must have been

A

$4.2\%$.

B

$4.0\%$.

C

$96.0\%$.

D

$5.0\%$.