What will be the inflation rate is the velocity of money

Reference no: EM13184040

Suppose Money Supply is growing at a rate of 7% per year and RGDP is growing at a rate of 3% per year.

What is the inflation rate assuming the velocity of money is constant?
What will be the inflation rate is the velocity of money is increasing 2% per year instead of remaining constant?

Reference no: EM13184040

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