Which of the following statements are true? An increase in government debt is inflationary when government bonds and cash are perfect substitutes Monetarism is a theory about how banks create inflation Government bonds and private debt are perfect substitutes Labour market responses to Covid created inflation

Economics: Private and Public Choice (MindTap Course List)
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ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter12: Fiscal Policy, Incentives, And Secondary Effects
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Which of the following statements are true?

  1. An increase in government debt is inflationary when government bonds and cash are perfect substitutes
  2. Monetarism is a theory about how banks create inflation
  3. Government bonds and private debt are perfect substitutes
  4. Labour market responses to Covid created inflation 
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