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The "Velocity of Circulation" Refers to the

Question 136

Multiple Choice

The "velocity of circulation" refers to the


A) ratio between the quantity of money and the price level.
B) speed with which dollars circulate in the economy as people use dollars to buy goods and services.
C) number of times a dollar is deposited and withdrawn from a bank account.
D) speed with which the Fed increases or decreases the quantity of money.
E) speed with which the nominal interest rate changes when the inflation rate changes.

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