Using the quantity equation, if M_t = $1,000, P_t = 1.1, and V_t= 11, then real GDP is: A) $100,000. B) $0.01. C) $10,000. D) $909.19. E) $826.45.

Question

Quizplus · Accepted Answer

The quantity equation is MV = PY, where M is the money supply, V is the velocity of money, P is the price level, and Y is the real GDP. Solving for Y gives Y = MV/P. Substituting the given values: Y = (1000 * 11) / 1.1 = 10,000.

Using the Quantity Equation, If Mt = $1,000, Pt =

Using the Quantity Equation, If M_t = $1,000, P_t =