If velocity is equal to 4, this means that
A) the rate of growth of the money supply is 4.
B) each dollar of the money supply is spent on the average 4 times per year.
C) for every 4 dollars of the money supply, nominal GDP will increase by 4.
D) an increase in the money supply will lead to an increase in aggregate supply of 4.
Correct Answer:
Verified
Q221: The equation of exchange is
A) an assumption
Q224: The number of times per year, on
Q226: An assumption used in the quantity theory
Q228: The income velocity of money is the
Q229: The equation of exchange is a formula
Q230: If nominal GDP is $5 trillion and
Q231: The quantity theory of money is based
Q236: Empirical evidence across numerous countries indicates that
Q238: According to the quantity theory of money
A)
Q240: The equation of exchange is an _
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents