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      Question

      Classical economists argue that money is neutral

      because
      A prices are fixed in the short run. Correct Answer Incorrect Answer
      B prices adjust quickly to a monetary expansion. Correct Answer Incorrect Answer
      C prices adjust to a monetary expansion only in the long run. Correct Answer Incorrect Answer
      D prices are slow to adjust to a monetary expansion. Correct Answer Incorrect Answer
      E None of these Correct Answer Incorrect Answer

      Solution

      Classical economists argue that money is neutral because prices adjust quickly to a monetary expansion.

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