The number of times cash moves through the economy in a year is measured by the "velocity of money," which is calculated by dividing a country's GDP by its total money supply. This essentially shows how many times the average dollar changes hands in a year; a higher velocity indicates a more active economy with rapid spending.

Key points about the velocity of money:

Calculation: GDP / Money Supply
Interpretation: A high velocity means money is circulating quickly, while a low velocity indicates slower spending.
Factors affecting velocity: Consumer confidence, interest rates, economic activity

The speed at which money in a debit or credit card moves through the economy is measured by the "velocity of money," and generally, it's considered to be quite fast, with most transactions processed almost instantly, allowing money to change hands rapidly throughout the year; however, the exact speed depends on factors like consumer spending habits and the overall economic climate.

Key points about the velocity of money and debit/credit cards:

Near-instant transactions:

Most debit and credit card transactions are processed electronically, meaning the money transfers almost immediately between accounts, contributing to a high velocity of money.

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