Is variability in velocity more of a problem in high or low inflation countries? Explain.
What will be an ideal response?
In countries where inflation and money growth are both very high, say over 100 percent, variations in the growth of velocity are annoyances the solution to the inflation problem is to get control of money growth. In low inflation environments, the success of the use of money growth as a monetary policy tool very much is predicated upon the stability of velocity. In these environments an unstable velocity of money can make monetary policy very difficult.
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What is the difference between a devaluation and a revaluation of a currency?
What will be an ideal response?
________ money could be used for some other purpose other than as a medium of exchange, for example, gold coins could be melted down and turned into gold jewelry
A) Commodity B) Fiat C) Paper D) Electronic
If a tax shifts the supply curve downward (or to the right), we can infer that the tax was levied on
a. buyers of the good. b. sellers of the good. c. both buyers and sellers of the good. d. We cannot infer anything because the shift described is not consistent with a tax.
The largest single source of revenue for the federal government is the
A. corporate income tax. B. federal excise tax. C. personal income tax. D. Social Security tax.