Qualification > Commerce

neeed help in economics..A level cie

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pastyear:
Quantity theory of money (Fisher Equation)
MV=PT
M is money supply
V is velocity of circulation
P is pric level
T is transactions or output in the economy

We assume that V and T is constant, so they will not affect the changes in money supply
So, when M increase 10%, P also increase 10%

This are what I know about it as this is A2 Level. Hope you have a clue.

lucien2a:
good job pastyear
It had assume it is under the condition of full employment.

azalyee:
but how do we use it in an essay??wat is its usefulness??

niway Thanks pastyear n luchien2a to've stop by..

lucien2a:
welcome

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