GDP is 5 trillion dollars, the price level is $2, money supply is 2 trillion dollars. What is the value of the velocity of money according to the quantity equation?
A. 5
B. 2 (WA)
C. 10
D. 8
E. Can't be determined.
A. 5
MV = PY V = (PY / M) V = (5 * 2) / 2 V = 10 / 2 V = 5
You might also like to view...
A constant returns to scale production function means that if all inputs are halved then output will
a. double. b. increase, but not double. c. fall by half. d. fall, but not by half. e. none of the above.
Public choice deals with
A) negative and positive externalities. B) public-sector decision making. C) how people choose between several mutually exclusive options. D) bond, stock, and money markets. E) none of the above
Government subsidies are in place to protect the population rather to benefit the economy in the case of which recipient(s)?
(A) Tobacco growers in the United States. (B) National airlines in Western Europe. (C) Small farms in France. (D) A national car company in Indonesia.
A situation in which output decreases while prices increase is often referred to as:
A. inflation. B. negative economic growth. C. a recession. D. stagflation.