Modern mainstream macroeconomists agree with the monetarists that
A) the Fed should increase the money supply at a ﬁxed annual rate.
B) velocity is highly stable.
C) ﬁscal policy is largely ineffective.
D) "money matters" in the macroeconomy.

Question

Quizplus · Accepted Answer

Modern mainstream macroeconomists agree with the monetarists that "money matters" in the macroeconomy. While they do not necessarily advocate for a fixed annual rate of money supply growth or believe that velocity is highly stable, they do generally recognize the importance of monetary policy in shaping the overall performance of the economy. They also tend to be more skeptical of the effectiveness of fiscal policy compared to monetary policy.

Modern Mainstream Macroeconomists Agree with the Monetarists That