Question 5 An economy has a real GDP of 3,000 and a price level of 1.5. (a) If the money supply is 1500, what is the velocity of circulation? (V=3) (b) If the velocity of circulation is 2, what is the money stock in the economy? (M=2250) (c) Suppose the quantity theory of money holds in the economy. If the money supply increases by a factor of 2, what is the effect on the price level. (It will also increase by a factor of 2)