Monetarists argue that the money supply should
A) grow at a rate equal to the average growth of real output.
B) grow at a rate slower than the average growth of real output.
C) grow at a rate greater than the average growth of real output.
D) be held constant over the business cycle.

Question

Quizplus · Accepted Answer

Monetarists, such as Milton Friedman, argue that the money supply should grow at a steady rate in line with the long-term average growth of real output to ensure price stability and avoid causing economic fluctuations.

Monetarists Argue That the Money Supply Should