Consider an economy with a constant growth rate of nominal money supply and a constant real interest rate r =0.08. Which of the following statements about the inflation rate of the economy would be valid?
A. The faster the economy's real output grows, the lower the inflation rate.
B. The long-term inflation rate would be equal to the money growth rate regardless of the output growth.
C. Without knowing the nominal interest rate,piπ+0.080.08,one can not tell the real demand for money and hence the inflation rate.