The velocity of money is:
A)the number of transactions a typical dollar is used in during a given period.
B)the number of goods a typical dollar can buy in a given period.
C)how quickly money is created through the financial system.
D)None of these statements is true.

Question

Quizplus · Accepted Answer

The velocity of money is the number of times a single unit of currency is used to purchase goods or services within a given period of time. It measures the rate at which money is changing hands within an economy. Option B describes the purchasing power of money and option C refers to the process of money creation.

The Velocity of Money Is