In which quarter(s) was the percentage change in velocity positive? Choose one or more: A. Q1 2020
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Question:
In which quarter(s) was the percentage change in velocity positive?
Choose one or more: A. Q1 2020
B. Q2 2020
C. Q3 2020
Part 2 (2 points)
Let’s focus on the second quarter since the change in velocity is so dramatic. During that quarter, the CPI fell by 0.9%, real GDP fell by 9.0%, the money supply rose by 23%, and velocity changed by %. Give your answer to one decimal.
Part 3 (2 points)
Which of the following can explain such a large change in velocity that occurred during the second quarter?
Choose one: A. People and banks were spending their money at faster rates.
B. There was a substantial increase in the money supply.
C. People and banks were holding on to their money longer.
D. The inflation rate was negative.
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