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A member of Congress, who has never had an economics course, has just been placed on a Money and Banking Committee. The official needs a briefing prior to the first meeting concerning the role of the money supply in the economy. Which of the following statements should you insist that the official remember when entering the first committee meeting?A.There is an indirect relationship between the growth of the money supply and the price level; and a direct (but not perfect) relationship between the growth of the money supply and GDP growth.B.There is a direct, albeit loose, relationship between the growth of the money supply and the price level; and an indirect relationship between the growth of the money supply and GDP growth.C.There is an indirect relationship between the growth of the money supply and the price level; and an indirect relationship between the growth of the money supply and GDP growth.D.There is a direct, albeit loose, relationship between the growth of the money supply and the price level; and a direct relationship between the growth of the money supply and GDP growth.
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