Study Guide to Man, Economy, and State with Power and Market

Chapter 11: Money and Its Purchasing Power 153
7. When the demand for money changes, this alters
the PPM and restores equilibrium. But does this
translate into anything “real”? For example, if
everyone doubles his or her cash balance, has
anything really changed? If not, what purpose
does it serve besides accommodating everyone’s
arbitrary whims?
8. In criticizing Keynes, Rothbard argues that,
“Speculation . . . disappears in the ERE, and
hence no fundamental causal theory can be based
upon it” (p. 789). Does this argument eliminate
Rothbard’s ability to explain the earnings of
stockbrokers or advertising executives?
9. What is the likely secular trend for the four
determinants of the PPM in a progressing economy?
(p. 817)
10. What are the problems with index numbers to
measure the PPM? (pp. 845–46)