If the money supply is $6,000, velocity is 5, and Real GDP is 10,000 units of output, then the price level is _____________. If the money supply doubled over a short time period to $12,000, the simple quantity theory of money would predict that _____________________

A) $3; the price level would double
B) $3; Real GDP would double
C) $3; the price level would be cut in half
D) $2; the price level would double

ANSWER

A