If the Amount of Money in Circulation Is $50 Million

question 111

Multiple Choice

If the amount of money in circulation is $50 million and nominal GDP is $150 million, then the velocity of money is:

• A)​0.33.
• B)​2.
• C)​3.
• D)​impossible to determine from the information provided.

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Definitions:

Bond Investment Transactions

A financial activity involving the buying or selling of bonds, which are debt securities issued by entities to raise funds.

Accrued Interest

The interest that has been incurred but not yet paid at the end of a period on loans or bonds.

Semiannual Interest

Interest that is computed and disbursed semi-annually.

Long-term Investment

Assets intended to be held for more than one year for capital growth, income generation, or other strategic purposes.