If the Money Supply Remains Constant and the Nominal Gdp
If the money supply remains constant and the nominal GDP increases,what can we conclude?
A)The velocity of money will fall.
B)The price index will fall.
C)Interest rates will rise.
D)Bond prices will rise.
What does the velocity of money measure?
A)The number of times that money is spent on the same article during a year.
B)The reciprocal of the reserve ratio.
C)The average annual rate of increase in the money supply.
D)The rate at which the money supply turns over in generating income.
E)The ratio of the total demand for money to the transactions demand.
In the equation of exchange,what does V represent?
A)The reciprocal of the price level.
B)The reciprocal of the money multiplier.
C)The quantity of real output.
D)The number of times per year the average dollar is spent.
E)The value or purchasing power of the dollar.
According to monetarists,how does a change in the money supply affect the economy?
A)By changing the velocity of the money which in turn changes the nominal GDP.
B)By changing the rate of interest which in turn changes nominal GDP.
C)By changing investment which in turn changes nominal GDP.
D)By changing aggregate expenditures which in turn changes nominal GDP.