Answered

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Calculate the velocity of money if real gdp is 3,000 units, the average price level is $4 per unit, and the quantity of money in the economy is $1,500?

Sagot :

The velocity of money is 8.

Given,

Real GDP - 3,000 units

Velocity of money - ?

Average price level - $4 per unit

Quantity of money - $1,500

Thus,

V = P * Y / M

Where P is the price level, Y is the real GDP, and M is the quantity of money in the economy.

V = 4 * 3000 / 1500

V = 8

Hence, the velocity of money V = 8 which means that money changed hand 8 times on average.

In economy, velocity of money is a measurement of the rate at which money is exchanged in an economy. In other words, it means the number of times one dollar is spent to buy goods and services per unit of time.

To learn more about velocity of money here:

https://brainly.com/question/14004549

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