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:
“Absolutely speaking, the more money, the less virtue; for money comes between a man and his objects, and obtains them for him; and it was certainly no great virtue to obtain it.”
—Henry David Thoreau (1817–1862)