Which of the Following Statements Is Not Consistent with the Quantity

question 23

Multiple Choice

Which of the following statements is not consistent with the quantity theory of money?

• A) The velocity of money can be affected by how frequently workers are paid.
• B) The velocity of money can be affected by the development of new financial instruments, such as interest-bearing checking accounts.
• C) The velocity of money can be affected by the manner in which the banking system clears transactions between banks.
• D) Velocity can change with changes in the interest rate.

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Definitions:

Disbursements

Financial payments made by a business, including cash expenditures, payments on debts, or distribution of dividends.

Beginning Balance

The amount of money in a given account at the start of a financial period.

Petty Cash Fund

A small amount of cash kept on hand for making immediate, minor expenditures.

Journal Entries

The recordation of financial transactions in a company's accounting system, typically involving a debit and credit entry.