Economics · Monetary Theory
Which of the following statements is NOT true according to Milton Friedman's Quantity Theory of Money?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Money is broadly defined to include currency, demand deposits, and time deposits.
- 2Money is treated as a luxury good (income elasticity > 1).
- 3Money is considered an asset or capital good yielding services.
- 4The long-run demand for money function exhibits very high interest rate elasticity.✓
Correct answer
The long-run demand for money function exhibits very high interest rate elasticity.
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