Consider a simple economy that produces only pens. The following table contains information on the economy's money supply, velocity of money, price level, and output. For example, in 2018, the money supply was $200, the price of a pen was $5.00, and the economy produced 400 pens. Fill in the missing values in the following table, selecting the answers closest to the values you calculate. Quantity of Money Price Level Quantity of Output Nominal GDP Year (Dollars) Velocity of Money (Dollars) (Pens) (Dollars) 2018 200 5.00 400 2019 202 10 400 The money supply grew at a rate of from 2018 to 2019. Since pen output did not change from 2018 to 2019 and the velocity of money the change in the money supply was reflected v in changes in the price level. The inflation rate from 2018 to 2019 was
Consider a simple economy that produces only pens. The following table contains information on the economy's money supply, velocity of money, price level, and output. For example, in 2018, the money supply was $200, the price of a pen was $5.00, and the economy produced 400 pens. Fill in the missing values in the following table, selecting the answers closest to the values you calculate. Quantity of Money Price Level Quantity of Output Nominal GDP Year (Dollars) Velocity of Money (Dollars) (Pens) (Dollars) 2018 200 5.00 400 2019 202 10 400 The money supply grew at a rate of from 2018 to 2019. Since pen output did not change from 2018 to 2019 and the velocity of money the change in the money supply was reflected v in changes in the price level. The inflation rate from 2018 to 2019 was
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter13: Money And The Banking System
Section: Chapter Questions
Problem 9CQ
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![Consider a simple economy that produces only pens. The following table contains information on the economy's money supply, velocity of money,
price level, and output. For example, in 2018, the money supply was $200, the price of a pen was $5.00, and the economy produced 400 pens.
Fill in the missing values in the following table, selecting the answers closest to the values you calculate.
Quantity of Money
Price Level
Quantity of Output
Nominal GDP
Year
(Dollars)
Velocity of Money
(Dollars)
(Pens)
(Dollars)
2018
200
5.00
400
2019
202
10
400
The money supply grew at a rate of
from 2018 to 2019. Since pen output did not change from 2018 to 2019 and the velocity of
money
, the change in the money supply was reflected
in changes in the price level. The inflation rate from
2018 to 2019 was](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F54827682-bc2e-453e-8315-80bfd8615b3c%2F584f0c74-4d4a-4857-a435-bd66103474c7%2F0msg1vc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Consider a simple economy that produces only pens. The following table contains information on the economy's money supply, velocity of money,
price level, and output. For example, in 2018, the money supply was $200, the price of a pen was $5.00, and the economy produced 400 pens.
Fill in the missing values in the following table, selecting the answers closest to the values you calculate.
Quantity of Money
Price Level
Quantity of Output
Nominal GDP
Year
(Dollars)
Velocity of Money
(Dollars)
(Pens)
(Dollars)
2018
200
5.00
400
2019
202
10
400
The money supply grew at a rate of
from 2018 to 2019. Since pen output did not change from 2018 to 2019 and the velocity of
money
, the change in the money supply was reflected
in changes in the price level. The inflation rate from
2018 to 2019 was
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