Which of the following would cause an increase in the velocity of money?

Which of the following would cause an increase in the velocity of money?
 a. An increase in the use of credit cards
 b. An increase in the money supply
 c. An increase in the demand for money
 d. A decrease in the rate of interest
 e. A decrease in nominal GDP and a constant money supply

QUESTION 2

An expansionary gap generally creates inflationary pressure in an economy.
 a. True
  b. False
  Indicate whether the statement is true or false

QUESTION 3

An increase in the expected inflation rate causes:
 a. the velocity of money to increase.
  b. the velocity of money to decrease.
  c. the actual inflation rate to fall.
 d. the actual price level to decrease.
  e. the money supply to increase.

QUESTION 4

The actual price level is assumed to be constant along a given short-run aggregate supply curve.
 a. True
  b. False
  Indicate whether the statement is true or false

QUESTION 5

The velocity of money increases with a _____, other things constant.
 a. fall in the inflation rate
 b. rise in the inflation rate
 c. rise in the employment rate
  d. fall in the exchange rate
 e. rise in the real interest rate

QUESTION 6

If the actual price level is lower than the expected price level, the economy will contract in the short run.
 a. True
  b. False
  Indicate whether the statement is true or false

QUESTION 7

The velocity of money is defined as:
 a. the time it takes the average worker to get to the bank with his/her paycheck.
 b. the time it takes banks to clear checks.
 c. the average number of times per year each dollar is used to purchase final goods and services.
 d. the ratio of money supply to the average price level in an economy.
 e. the average number of times per year each dollar is spent for goods, payrolls, Social Security payments, etc.