If $\vec { v }$ = 4%, $\vec { P }$ = 3%,and $\vec { Y } _ { R }$ = 2%,then $\vec{ M }$ must equal:
A) 1%.
B) 2%.
C) 6%.
D) 7%.

Question

Quizplus · Accepted Answer

The equation for the growth rate of money supply $\vec{ M }$ is given by the equation $\vec{ M } = \vec{ v } + \vec{ P } + \vec{ Y } _ { R }$. Substituting the given values: $\vec{ M } = 4\% + 3\% + 2\% = 9\%$. However, since none of the options match 9%, it seems there might be a misunderstanding or miscalculation in the problem setup.

If v⃗\vec { v }v = 4 P⃗\vec { P }P = 3%,and

If $\vec { v }$ = 4 $\vec { P }$ = 3%,and