If Real GDP Is $10 Trillion and the Velocity of Circulation

question 380

Multiple Choice

If real GDP is $10 trillion and the velocity of circulation is 2, the quantity of money

• A) is $20 trillion.
• B) is $2 trillion.
• C) is $5 trillion.
• D) cannot be determined from the information given.

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Definitions:

Equivalent

Equal in value, amount, function, meaning, etc., often used in mathematics and chemistry.

Per Annum

A Latin term meaning "per year," often used in financial contexts to describe rates or amounts calculated over a yearly basis.

Invested

Invested refers to the allocation of resources, usually money, into a financial venture with the expectation of receiving future returns.

Per Annum

Annually; indicating the occurrence, rate, or amount in a year.