If nominal GDP is 28000 and the money supply is 7000, what is velocity? 11.5 .68 4 18 Solution - 4 is correct According to quantity theory of money, M*V = P*Y P*Y= 28000 M= 7000 V= 28000/7000= 4 - money supply in the economy increases. Central bank buys bonds from the bank in exchange for money, This increases money supply. - 830 million is correct Assets include cash in vault, reserves, loans and bonds. Since sale of loan is balanced by cash received in exchange Total assets= 50+180+600= 830 million.