Register
if the growth rate of the money supply is 8%, velocity is constant, and reald GDP grows at 2% per year on average, then the inflation rate will be
158k views
4 votes
if the growth rate of the money supply is 8%, velocity is constant, and reald GDP grows at 2% per year on average, then the inflation rate will be

User Bek Roz
by
5.7k points

1 Answer

5 votes

Answer:

4%

Step-by-step explanation:

The quantity theory of money states that :

Money supply x Velocity = price x real GDP

8% = 2% x price

Price = 4%

User Iskar Jarak
by
5.8k points
Ask a Question
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

6.5m questions

8.7m answers

Other Questions

One reason that businesses want to combine with other businesses is to A. avoid taxes. B. delay expenses. C. hire more workers. D. reduce expenses.
Which of the following is an example of a fixed expense? A.) Clothing B.) Rent C.) Food D.) Entertainment
A ______ is "the basic interpretive mechanism to let people know what an organization is doing and are sent out to editors and reporters in hopes of stimulating favorable stories about their organizations"
All of the following are fees typically charged by credit card companies EXCEPT: A. Late payment fee B. Balance Transfer fee C. Annual membership fee D. Reload fee
Individuals are free to produce and sell whatever products they wish
Link Copied!