The velocity of money is:
A)how quickly money can be printed.
B)how quickly individuals spend their income.
C)the average number of times a dollar is used in a transaction per year.
D)how many times individuals are paid per year.
E)none of the above

Question

Quizplus · Accepted Answer

The velocity of money refers to the frequency at which a unit of currency, such as a dollar, is used to purchase goods and services within a given period of time, usually a year. Therefore, the correct choice is C, as it represents the average number of times a dollar is used in a transaction per year. A, B, D, and E are not accurate definitions of the velocity of money.

The Velocity of Money Is