The Number of Times Per Year, on Average, That a Dollar

question 29

Multiple Choice

The number of times per year, on average, that a dollar is spent on final goods and services is known as

• A) the money supply.
• B) the equation of exchange.
• C) the price of money.
• D) the income velocity of money.

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Definitions:

Efficiency

The extent to which resources are utilized optimally to achieve desired outcomes with minimum waste or effort.

Second Best

A concept in economics that suggests if all optimal conditions cannot be satisfied, the second-best option should be pursued.

Distortionary Tax

Taxes that cause people to alter their behavior in a way that distorts the allocation of resources from their most efficient uses.

Economic Choices

Decisions made by individuals, households, or firms regarding the allocation of scarce resources to satisfy needs and wants.