The value of money is calculated as:
A) M1 × Price level.
B) Price level / Money supply.
C) 1 / Price level.
D) Interest rate / Price level.

Name: The value of money is calculated as: A) M1 × Price level. B) Price level / Money supply. C) 1 / Price level. D) Interest rate / Price level.
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Question

Quizplus · Accepted Answer

The value of money is calculated as the reciprocal of the price level, meaning as the price level increases, the value of money decreases, and vice versa. This is represented by 1 / Price level.

The Value of Money Is Calculated As