The formula for computing the velocity of money is GDP/M, where M is a money supply measure.
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The formula for computing the velocity of money is GDP/M, where M is a money supply measure. Go to the CANSIM data available in the Student Resources section of your MyEconLab website and download monthly data since 1961 on real GDP (series V41707150), the GDP deflator (series V1997756), and the monetary base (series V37145). Compute the most recent year’s velocity of base money and compare it to its level in 2002. Has it risen or fallen? Suggest reasons for its change since that time.
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To compute the velocity of money you will need to first adjust the GDP figures for inflation using t...View the full answer
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Related Book For 
The Economics of Money Banking and Financial Markets
ISBN: 978-0321785701
5th Canadian edition
Authors: Frederic S. Mishkin, Apostolos Serletis
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