Income velocity of money doubles

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Suppose that initially the money supply is ?$2 ?trillion, the income velocity of money is 4, the price level equals 2?, and real GDP is ?$4 trillion in? base-year dollars. Then suppose that the quantity of money in circulation remain fixed but the income velocity of money doubles. If real GDP remains at its? long-run potential? level, calculate the equilibrium price level

Consider the following data. The money supply is ?$1 ?trillion, the price level equals 3, the real GDP is ?$4 trillion in? base-year dollars. Calculate the income velocity of money.

In an? economy, the growth rate of GDP is known to be 2%, the growth rate of the money supply is 12?%, and the velocity of money is constant. According to the quantity theory of money and? prices, in this? economy, the inflation rate must be?

Reference no: EM132415174

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