If the Velocity of Money Is About 1

question 98

Multiple Choice

If the velocity of money is about 1.8 and money stock is about $8 trillion, what is real GDP?

• A)$0.8 trillion
• B)$4.4 trillion
• C)$14.2 trillion
• D)we cannot compute real GDP from the data; we can only compute nominal GDP

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Definitions:

Crime Rates

Statistics that measure the occurrence of crimes within a given area over a specified period, often used to assess safety and enforcement effectiveness.

Mid-nineteenth Century

Refers to the time period between 1850 and 1869, marking the middle of the 19th century.

Regressive Taxation

A tax system where the tax rate decreases as the amount subject to taxation increases, meaning lower-income individuals bear a proportionally higher tax burden.

Taxes

Mandatory contributions levied on individuals or corporations by a government to fund public expenditures.