The primary cause of inflation according to the theory
What is increase in quantity of money
100
What is the nominal GDP when the money supply is $2 trillion and velocity is 5?
What is $10 trillion
100
Define velocity of money
What is the rate at which money changes hands.
100
Mr. Burchette's first name
What is Derrick Burchette
200
The meaning of P and Q in the equation
What is
P: Average price level
Q: Real value of all goods and services (Real GDP)
200
The main influence in economic activity, according to the theory
What is Quantity of Money
200
What is the value of velocity when the money supply
is $200, real output is 1,000 units, and the price per unit of output is $1?
What is 5
200
Define Quantity Theory of Money
What is a theory asserting that the quantity of money available determines the price level and the growth rate in the quantity of money determines the inflation rate
200
What is our favorite Starbucks drink?
What is Caramel Macchiato
300
The value of M and V
What is
M: The money supply
V: Velocity of money*
*The number of times a dollar is spent.
300
The value of money is determined by..
What is amount of money available in an economy
300
What is the real demand for money and the nominal demand for money.
Assuming that the quantity theory of money holds and that velocity is constant at 5. Output is fixed at its full-employment value of 10,000, and the price level is 2.
What is 4000
300
Define diminishing marginal utility
What is the principal establishing that price alone does not determine demand
300
What is this word unscrambled?
CECOMCSMAORONI
What is Macroeconomics
400
Q determined by..
What is labor, capital, natural resources, knowledge, and organization
400
The effect on velocity if it becomes easier to transfer and transport money
What is increases velocity
400
What is the price level in year 2, and how much has the price level changed since year 1?
Let's assume that in year 1:
P = 5
Q = 20
M = 25
V = 4
Let's assume that in year 2:
Q = 21
M = 27
V remains the same at 4.
What is 5.14
400
Define the determinants of demand
What is Consumer tastes, the number of buyers in the market, the money incomes of consumers, the prices of related goods, and price expectations
400
Who is the oldest out of us three?
Who is Mimie Le
500
The effect of V on M
What is
If V is constant, then increase in M (increases spending)
If V isn’t constant, then increase in M can be offset
500
The effect on velocity if one hoards money
What is funds become less available to businesses and consumers through financial markets, which lowers the money supply and lowers velocity.
500
What is the change in the price level?
Let's assume that in year 1:
P = 8
Q = 30
M = 40
V = 6
Let's assume that in year 2:
Q = 30 (no change)
M = 40 (no change)
V = 5.5
What is 7.33
500
Define shortage
What is the property of being an amount by which something is less than expected or required?