Between 2007 and 2017, the drop in velocity meant that the _____
A) increase in the money supply did not result in much inflation.
B) decrease in the money supply did not result in much inflation.
C) increase in the money supply did result in inflation.
D) decrease in the money supply did result in inflation.
E) money supply was unchanged.

Question

Quizplus · Accepted Answer

The drop in velocity means that the same amount of money is being used less frequently, so the increase in the money supply did not result in much inflation. Therefore, choice A is the correct answer.

Between 2007 and 2017, the Drop in Velocity Meant That