What do most economists think is the most accurate statement about velocity?
A) Velocity is fairly constant in the short run but varies considerably in the long run, complicating predictions about nominal GDP.
B) M1 velocity is more stable in the short run than M2 velocity, and it has been a superior tool in predicting changes in nominal GDP.
C) Velocity is not constant in the short run, and predictions about nominal GDP have not fared well.
D) M2 velocity has been less stable than M1 velocity, but both are reliable enough to make accurate predictions about changes in nominal GDP.
Correct Answer:
Verified
Q61: In order to consider the equation of
Q65: The main policy tool for manipulating consumer
Q66: The quantity theory of money assumes that
A)velocity
Q67: If the public decides to hold smaller
Q68: Nominal GDP is proportional to money stock
Q73: If the Fed's monetary policy causes a
Q74: Which of the following will reduce the
Q77: When the Fed increases the money supply,
Q78: The equation of exchange can be written
Q79: The equation of exchange is an accounting
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents