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2 years ago

Pleaseeee help me

Business

1 answer:

Setler79 [48]2 years ago

6 0

Answer:

C)The government restricts the amount of money that banks can lend.

Explanation:

The government use interest rates as a tool for regulating the amount of money that banks can lend. In the US, the government, through the Fed, can adjust the Fed rate to restrict lending. If the government observers that there is too much in circulation, It increases the Fed rate. Increasing this rate means the banks will also have to increase the interest rates.

When the interest rates are high, the cost of borrowing goes up, which restricts borrowing. Reduced lending limits the amount of money in circulation.

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If the money supply is $500 and nominal income is $3,000, the velocity of money is A. 1/60. B. 1/6. C. 6. D. 60.

algol [13]

Answer:

The correct option is c.6

Explanation:

For computing the velocity of money, the following formula should be used which is shown below:

The Velocity of money = Nominal income ÷ money supply

where,

Nominal income is $3,000

and, the money supply is $500

Now put these values to the above formula so that we can find out the answer

So, the answer would be equal to

= $3,000 ÷ $500

= 6

Thus, the velocity of money is 6

Hence, the correct option is c.6

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2 years ago

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Westkost [7]

Answer:

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Explanation:

Data provided in the question

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vesna_86 [32]

Answer:

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