Which of the following statements about the velocity of money is true?
A) Velocity does not change over time.
B) Velocity has been rapidly increasing every year since the early 1980s.
C) Changes in velocity are directly related to changes in the money supply.
D) At any particular moment in time the velocity of money can be considered fixed because velocity does not change significantly from month to month.

Question

Quizplus · Accepted Answer

The velocity of money, which is the rate at which money is exchanged in an economy, does not significantly change from month to month, making it relatively stable over short periods. However, it can vary over longer periods due to changes in economic activity, interest rates, and other factors.

Which of the Following Statements About the Velocity of Money