If Nominal GDP Is $5 Trillion and Velocity Is 20

question 325

Multiple Choice

If nominal GDP is $5 trillion and velocity is 20, then

• A)actual money balances held by the nonbanking public are $250 billion.
• B)actual money balances held by the nonbanking public are $100 trillion.
• C)real GDP equals $100 trillion.
• D)real GDP equals $400 trillion.

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Definitions:

Equilibrium Outcome

A state in a game where all players have chosen their strategies and no participant can gain by unilaterally changing their own strategy.

Prisoners' Dilemma

A scenario in game theory where individuals acting in their own self-interest pursue a course of action that does not result in the ideal outcome for any participant.

Maximin Strategy

A decision rule used in game theory and decision theory aiming to maximize the minimum payoff.

Dominant Strategies

A strategy in game theory that yields the best outcome for a player, no matter what the other players do.