Question

4. Velocity and the quantity equation Consider a simple economy that produces only cell phones. 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 cell phone was $7.50, and the economy produced 400 cell phones. Fill in the missing values in the following table, selecting the answers closest to the values you calculate. Year Quantity of Money (Dollars) 200 Velocity of Money Price Level Quantity of Output (Dollars) (Cell phones) 7.50 400 2018 Nominal GDP (Dollars) 3,000.00 2019 208 15 7.80 400 3,120.00 The money supply grew at a rate of 4% from 2018 to 2019. Since cell phone output did not change from 2018 to 2019 and the velocity of money remained the same the change in the money supply was reflected partially in changes in the price level. The inflation rate from 2018 to 2019 was 104% Grade It Now Save & Continue Continue without saving

Answer 1

Year I mency of money duel of Duantity, Nominel a (P) Cufput (Y) (84) Quarkity Velouty LDP 2018 2019 200 208 15 15 7.50 400 3,000 17.81 400 3120 Formula used: mv=py] The money supply 4% from umathed he same, the entirely 4%.