8. The inverse of price level measures
Answers
Explanation:
The amount of output one must give up to obtain a unit of money is therefore equal to the reciprocal of the price level. The inverse of the price level thus represents what a unit of money is worth in terms of goods, or the value of money.
Answer:
The consequences of unfettered printing of paper money were deemed undesirable in several places in the previous Topic. Now we turn to an analysis of the effects of excess money growth. The discussion focuses on the determinants of the price level. It will be recalled that the price level is the average of all prices in the economy, taken as a percentage of that same average in some earlier base period. And inflation is the growth or increase, on average, of prices---the annual rate of inflation is the year-to-year percentage growth of the price level.