Adherents of the traditional monetary rule say that the supply of money should be:
A) increased at a constant rate each year.
B) decreased during recession and increased during inflation.
C) held constant over time.
D) increased during recession and decreased during inflation.

Question

Quizplus · Accepted Answer

Adherents of the traditional monetary rule, like those following Milton Friedman's k-percent rule, advocate for increasing the money supply at a constant rate each year to ensure stable economic growth and avoid the destabilizing effects of discretionary monetary policy.

Adherents of the Traditional Monetary Rule Say That the Supply