A temporary decrease in consumer spending causes:
A) a decrease in the economy's long-run potential growth rate.
B) an upward-shift of the SRAS curve.
C) a decrease in velocity growth (
$\vec { v }$ ).
D) an increase in money growth (
$\vec { M }$ ).

Question

Quizplus · Accepted Answer

A temporary decrease in consumer spending would lead to a decrease in the velocity of money ($\vec { v }$), as it implies that money is changing hands less frequently within the economy. This is because the velocity of money is a measure of how quickly money is spent and re-spent in the economy.

A Temporary Decrease in Consumer Spending Causes: A) a Decrease v⃗\vec { v }v

A Temporary Decrease in Consumer Spending Causes:
A) a Decrease $\vec { v }$