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:
“Sir, he throws away his money without thought and without merit. I do not call a tree generous that sheds its fruit at every breeze.”
—Samuel Johnson (1709–1784)