Final answer:
The velocity of money, calculated using the formula Nominal GDP divided by Money supply, with given values of $800 for Nominal GDP and 400 for money supply, is 2.
Step-by-step explanation:
If Nominal GDP is $800, the price level is 100, and the money supply is 400, we can calculate the velocity of money using the equation:
Money Supply x Velocity = Nominal GDP
To solve for velocity, we would rearrange the equation as follows:
Velocity = Nominal GDP / Money Supply
Substituting the given numbers into this formula gives us:
Velocity = $800 / 400
Velocity = 2
Therefore, the velocity of money in this case is 2.