If an economy has a money supply of $200, a velocity of 12, and a price level of $2, the output level must be:

Name: If an economy has a money supply of $200, a velocity of 12, and a price level of $2, the output level must be:
Brand: Quizplus
Rating: 4.9 (57 reviews)

Question

Quizplus · Accepted Answer

The equation of exchange is MV = PQ, where M is the money supply, V is the velocity of money, P is the price level, and Q is the output level. Substituting the given values into the equation, we get 200 * 12 = 2 * Q. Solving for Q, we get Q = 1,200 units.

If an Economy Has a Money Supply of $200, a Velocity