velocity of money

economics

Also known as: circular velocity of money, velocity of circulation

Learn about this topic in these articles:

In economic stabilizer: Monetary policy
The simplest relationship between income and the demand for money would be: M^d = kY. Here, k is a constant. Since Y is a flow (measured per year) and M^d a stock (the average stock of money over the year), k has the dimension of a “storage…
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In inflation: 1. The quantity theory of money
…frequency of spending (aka, the velocity of circulation or velocity of money).
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In money: An illustration of the quantity theory
Put differently, the income velocity of circulation is equal to 10 per year; that is, each \$1 on average is paid out 10 times a year. (For the sake of simplicity there are no business enterprises in this example; the members of the community buy and sell services from…
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