Most economists believe that money neutrality
A)does not hold in the short run.
B)does not hold in the long run.
C)does not hold in either the short run or long run.
D)holds in the short run and the long run.

Question

Quizplus · Accepted Answer

Money neutrality suggests that changes in the money supply only affect nominal variables and not real variables in the long run. However, in the short run, changes in the money supply can affect real variables like output and employment.

Most Economists Believe That Money Neutrality