The velocity of money measures:
A) the quantity of money in an economy
B) the rate of circulation of the money supply
C) the level of inflation caused by the money supply
D) none of the above

Question

The velocity of money measures:
A)	the quantity of money in an economy
B)	the rate of circulation of the money supply
C)	the level of inflation caused by the money supply
D)	none of the above

Quizplus · Accepted Answer

The velocity of money measures the rate at which money is circulating in an economy. It is calculated by dividing a measure of economic activity, such as GDP, by the money supply. It reflects how quickly money is changing hands and being used for transactions within the economy.

The Velocity of Money Measures