Suppose the money supply is €200, real output is 1,000 units, and the price per unit of output is €1. a. What is the value of velocity? b. If velocity is fixed at the value you solved for in part (a), what does the quantity theory of money suggest will happen if the money supply is

Consider the following data for the United States: On October 01, 2020, M1 was $17,609 billion, the price level was 1.144, and real GDP was $18,794 billion in base-year dollars. *Real-time data provided by Federal Reserve Economic Data (FRED), Federal Reserve Bank of Saint Louis. Using the information provided above, the income velocity of money was (Enter your response rounded to two decimal places.)

Attempt the following multiple choice questions: 1. The velocity of money represents: (a) Whether individuals are increasing or decreasing the quantity of money spent in an economy (b) The quantity of money available in an economy (c) The level of prices determined by the equation of exchange (d) How often money is used in a specific period of time (e) Whether currency is accepted as a medium of exchange in an economy 2. According to the quantity theory of money, (a) Increases in the money supply will lead to inflation, ceteris paribus (b) The level of inflation is independent of the money supply (c) The money supply times the velocity equals the real GDP (d) When real GDP rises, the money supply must fall by the same proportion (e) The velocity of money is assumed to fluctuate widely over time 3. Monetarists differ from Classical economists in their view of money in that monetarists believe: (a) The velocity of money is relatively constant over time (b) Prices are not influenced by…

Suppose the money supply M has been growing at 19% per year and nominal GDP, PY, has been growing at 77% per year. The data are as follows (in billions of dollars). M PY V 2021 400 4000 2022 476 7080 2023 566.44 12,532 Calculate the velocity V in each year. (Fill in the table above, rounding to one decimal place.) Velocity is growing at an approximate rate of % per year. (Round to the nearest whole number.)

Suppose that the Price level = 120, Supply of Money = $20 billion, and Real GDP = $4 billion. If the velocity of the money stays the same but Real GDP increases by 5%, what will happen to the price level if the supply of money increases by $5 billion? Select one: a. It will increase to 142.9 b. It will increase to 135.4 c. It will increase to 128.5 d. It will increase to 122.5 e. It will stay 120. These changes are offsetting

If M 1,000, P = 2, and Y = 4,000, what is velocity? = 1/2 1/4 8

Do not type in dollar signs or round any of your answers. In year one, the money supply (M) is equal to 500, the velocity of money (V) is 5, and the price level is 1.0. According to the equation of exchange, in year 1, nominal and real GDP are both equal to In year 2, the money supply is increased to 530.4 and velocity is unchanged. If the economy grew at the rate of 4 percent, real GDP in year 2 is equal to while nominal GDP in year 2 is equal to As a result of the Fed's decision to increase the money supply from 500 to 530.4, the price level rose from 1.0 to indicating that the inflation rate was percent.

If a country increases its money supply by 2%, and its nominal GDP increases by 3%, what can you say about what happened to the velocity of money in this country? Group of answer choices A) It decreased. B) None of the other options. C) It did not change. D) We cannot tell which way it changed. E) It increased.

In Canada during 2020, GDP grew slowly, while M1+ grew by 28%, its highest level since October 1985. a) Using the Quantity Equation, and assuming the velocity of money is stable, show the impact of an increase in the Money Supply. b) List and describe the costs of inflation.

If real GDP equals 7,000, nominal GDP equals 14,000, and the price level equals 2, then what is velocity if the money stock equals 3,500?