The ________ of money varies inversely with the price level.
A)law
B)purchasing power
C)standard of deferred payment
D)medium of exchange

Question

Quizplus · Accepted Answer

Purchasing power is the value of money in terms of what it can buy, and it varies inversely with the price level. In other words, as the price level increases, the purchasing power of money decreases, and vice versa. This relationship is known as the quantity theory of money.

The ________ of Money Varies Inversely with the Price Level