Suppose at Present People Hold a Quantity of Money Equal

question 7

Multiple Choice

Suppose at present people hold a quantity of money equal to 85% of nominal GDP. What happens to velocity if people wish to increase their money holdings to 80% of nominal GDP?

• A) Velocity can increase or decrease depending on people's tastes and preferences toward money.
• B) Velocity is unaffected.
• C) Velocity increases.
• D) Velocity decreases.

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Definitions:

Utilitarian

A philosophy focusing on the outcomes of actions, aiming to achieve the greatest good for the greatest number.

Distributive Justice

Concerns the fair and equitable distribution of benefits and burdens among members of a society or a group.

Harm

Physical or psychological damage or injury to an individual or group, or the potential to cause such damage.

Harassment

Unwanted, aggressive behavior or conduct that targets an individual or group, often causing distress or creating a hostile environment.