I need help with some macro economics.....?

Question

I am really having trouble coping up with my macro economics.... as i jumped a year.... can anybody please explain me these simple terms....
nominal quantity of money..
income velocity of circulation of money
real income
nominal money balances
nominal money income
real money balances

Answer 1

Nominal money, in economics, is the quantity of money measured in a particular currency and is directly proportional to the price level.

This means, among other things, that if the price level rises by 10%, people hold 10% more money than before. (ceteris paribus)

For example, if you hold $20 to buy pizza, and the price level increases by 10%, you essentially increase your money holding by $2, to a total of $22.

Real money is the quantity of money measured as a constant (eg: the value of the dollar in 1997), and relates to the above as follows:

Nominal money = Price level * Real money.

Hence Real Money = Nominal money/Price Level; the quantity of money measured in terms of what it will buy. Thus, your $22 at the new price level will buy you the same amount of goods and is the same quantity of real money as your $20 at the original price level.

Answer 2

In theory Republicans do but unfortunately they don't follow what is up on the GOP web site or the Constitution. Since the Republican Party got high jacked by neocons (which are liberals in a nice suit) they follow Socialist rules and that is why we are in this mess and our sovereignty is now in jeopardy. Democrats (also known as the New Socialist Party) usually are the ones that spend more but try and hide it. They are no better. Ron Paul represents what the Republican Party should and used to be. Peace, Sound Money and following the Constitution. As for your socialist argument if your talking about the EU ALL those countries gave up there sovereignty some not willingly. They are about to elect an EU President that will officially end those countries sovereignty. They always say if they have universal healthcare why can’t we? Their healthcare system sucks you have to wait months to get service and if you have cancer you may die before your appointment. Not to mention the high taxes they pay for crappy care. Why do you think people who can afford it come to the U.S.? Because we have the best heath care system in the world and the line is short. Also the more a gov. gives to its people the more they become dependent on it. So why try and do anything with your life if everything is given to you and Socialism always fails the people. The U.S. is very unique in that YOU have the right to fail or succeed. Socialism doesn’t give you that freedom because you work for the state not your self.

Answer 3

Velocity of money works like this - The Fed releases new money into the economy. After it gets spent on something, it gets spent again by those who got it, and this goes on and on making it seem to economy like the Fed had released several times more money than it did. Then a multiplier is calculated depending on the effect on the economy. .