(Solved): 26. The velocity of money is equal to: a. the money supply times the CPI b. Real GDP divided by the ...

26. The velocity of money is equal to: a. the money supply times the CPI b. Real GDP divided by the CPI c. nominal GDP divided by the money supply d. the CPI divided by the money supply 27. In the actual economy: a. velocity has been constant b. there has been a directly proportional relationship between the money supply and the price level c. increases in the money supply tend to cause increases in the price level, in the long run d. All of the above 28. According to the Keynesian monetary transmission mechanism: a. an increase in the money supply leads to a decrease in interest rates b. a decrease in interest rates leads to an increase in investment c. an increase in investment leads to an increase in Total Expenditures d. All of the above 29. Expansionary monetary policy: a. means an increase in the money supply b. Would be used to close an inflationary gap c. Both of the above d. Neither of the above 30. Monetarists: a. favor a balanced budget for fiscal policy b. favor a monetary rule for monetary policy c. Both of the above d. Neither of the above