In the equation of exchange, the nominal GDP is designated by
A) PQ/M.
B) MV/P.
C) PQ.
D) MV.

Name: In the equation of exchange, the nominal GDP is designated by A) PQ/M. B) MV/P. C) PQ. D) MV.
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Question

Quizplus · Accepted Answer

In the equation of exchange, nominal GDP (Y) is represented by PQ, where P is the price level and Q is the real output. The equation of exchange can be written as MV = PQ, where M is the money supply and V is the velocity of money. Solving for PQ, we get Y = PQ. Therefore, option C is the correct choice.

In the Equation of Exchange, the Nominal GDP Is Designated