36551177
Description
Mind Map by Katerina Kritikos, updated more than 1 year ago
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Created by Katerina Kritikos
almost 2 years ago
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Money supply: Velocity
- The ratio of GDP (final output/goods and services purchased by the end user) to the money supply
- it is the rate at which supply travels through the financial system.
- A higher velocity indicates that the economy is healthy and demand is high. Also
that businesses are further along in the business cycle which leads to increased
prices.
- Formula is V = PB/M
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