In a Small Economy, the Quantity of Money Circulating in the Economy

question 111

Multiple Choice

In a small economy, the quantity of money circulating in the economy is $2.5 million. Real GDP for the current year is $5 million, and the price level is 2. What is the velocity of money?

• A) 4
• B) 2
• C) 2.5
• D) 5

---

Definitions:

Colonial Identities

The sense of self and community shared by people living in colonies, often shaped by the interplay of indigenous cultures and colonial influences.

European Settlement

The process by which European countries established communities in distant lands, often resulting in the colonization and cultural transformation of those areas.

North American Continent

A vast geographical region that includes Canada, the United States, Mexico, and Greenland, characterized by diverse ecosystems and cultures.

Indian Communities

Groups or populations of Indigenous peoples with common cultural, linguistic, or ancestral ties, often living in specific geographic areas.