The velocity of money (also called velocity of circulation and, much earlier, currency) is the average frequency with which a unit of money is spent on new goods and services produced domestically in a specific period of time. Velocity has to do with the amount of economic activity associated with a given money supply. When the period is understood, the velocity may be presented as a pure number; otherwise it should be given as a pure number over time.
Read more about Velocity Of Money: Illustration, Indirect Measurement, Determination
Famous quotes containing the word money:
“Here far from the city we make our roadside stand
And ask for some city money to feel in hand
To try if it will not make our being expand,
And give us the life of the moving-pictures’ promise
That the party in power is said to be keeping from us.”
—Robert Frost (1874–1963)