1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Galina-37 [17]
3 years ago
6

Consider nominal GDP is 1500 and the money supply is 400. Instructions: Enter numerical values to two decimal places. a) What is

the velocity? V = 3.75 b) If nominal GDP rises to 1600, but the money supply does not change, how has velocity changed? Velocity will (increase/decrease) increases by 4-3.75 to V = 0.25 c) If GDP now falls back to 1500 and the money supply falls to 350, what is velocity? V = 4.29
Business
1 answer:
amid [387]3 years ago
3 0

Answer:

a. V=3.75

b. Velocity increases by 0.25

c. Velocity is 4.29

Explanation:

a)  the equation of exchange in the market is:

MV=PY

M=money supply

V=velocity

PY=nominal GDP

V=PY/V

V=1500/400=3.75

the velocity is 3.75

b)

V=1600/400

=4

the velocity increases by =4-3.75=0.25

c)

V=1500/350

=4.28571429

=4.29

the velocity is 4.29

You might be interested in
What are the three duties of a central bank?
murzikaleks [220]

Conducting monetary policy

Supervising and regulating depository institutions

Maintaining the stability of the financial system

6 0
3 years ago
Economists differ in their views of the role of the government in promoting economic growth. at the very least, the government s
viktelen [127]
<span>Economists differ in their views of the role of the government in promoting economic growth. at the very least, the government should lead the country.</span>
4 0
3 years ago
Suppose the real risk-free rate is 3.00%, the average expected future inflation rate is 5.90%, and a maturity risk premium of 0.
Kamila [148]

Answer:

The answer is 9.00%

Explanation:

real risk-free rate = 3.00%

average expected future inflation rate = 5.90%

Maturity risk premium = 0.10%

The expected rate of return on a 1 year treasury security would be = the average expected future inflation rate + maturity risk premium + real risk-free rate.

= 3.00% + 5.90% + 0.10%

= 9.00%

6 0
3 years ago
Assume the current U.S. dollar-yen spot rate is 90 ¥/$. Further, the current nominal 180-day rate of return in Japan is 1% (annu
Citrus2011 [14]

Answer:

Explanation:

Forward excahnge rate/spot exchange rate = (1+rh)/(1+rf)

rh - periodic interest rate in the home currency

rf - periodic interest rate in the foreign currency

Forward/90 = [1+1%*180/360]/[1+2%*180/360]

Forward = 1.005/1.01 * 90 = 89.55

Forward rate is 89.55 yen/$

3 0
2 years ago
Rosalie is a rather easy-going kind of woman. she works hard when she's at the office, but she refuses to do more than 40 hours
seropon [69]
<span>By the above mention condition we can conclude that Rosalie has a Type B personality. Some of the character traits involved in Type B are being flexible, emotional and expressive, relaxed and have a laid-back attitude. This Type B personality can help decrease the risk of heart disease.</span>
3 0
3 years ago
Other questions:
  • Joey's father is in a car accident and cannot work. what type of insurance replaces his father's earnings?
    7·2 answers
  • True or false: the price consumers pay will be higher if the tax were imposed on producers.
    12·1 answer
  • If you want to work in the construction field, what are some of the ways that you could advance your career?
    9·1 answer
  • Why do economists study the money supply? Be sure to mention liquidity in your response.
    6·2 answers
  • A clothing manufacturer makes both shirts and shorts. The sales price for shirts is $24 with variable costs of $10 and shorts ha
    12·1 answer
  • A consumer is persuaded to buy a product by a message that requires little thought and is based on an association with a brand's
    6·1 answer
  • The future of crime-and-justice reality provides for differing scenarios. the scenario that portrays the commercial media as ope
    15·1 answer
  • Easy money policy is _____.
    6·1 answer
  • When an institution wishes to take a large position in a municipal bond issue but does not want its activities to be well known,
    6·1 answer
  • Mark and Mike are having a few beers together. Mike tells Mark about his lifelong quest to find the elusive pink elephant in the
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!