An article in the Wall Street Journal in June 2016 notes: “The Fed’s preferred measure of consumer prices has fallen short of the central bank’s 2% annual target for 48 consecutive months.” Over the same period, the average annual growth rate of M1 was 9.5%, and over the four years prior to that, from June 2008 to June 2012, the average annual growth rate of M1 was 12.0%. Review the discussion of the quantity theory of money in Chapter 2, Section 2.5, which begins on page 40. Using the equation of exchange, explain how such high money supply growth rates can be consistent with an inflation rate of less than 2%. Prior to 1980, would we have expected to see an inflation rate less than 2%, given high growth rates of the money supply during the preceding few years? Briefly explain.