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Quantity Theory of Money Calculator

LAST UPDATE: June 20th, 2018

Money Supply Calculator

The velocity of Money Calculator

Average Price Level Calculator

Volume of Transactions Calculator

What is the quantity theory of money?

The quantity theory of money balances the price level of goods and services with the amount of money in circulation in an economy.

Formula

The quantity theory of money formula is:

MV = PT

Where:

M = Total amount of money in circulation in the economy

V = Velocity of money

P = Average price level

T = Volume of transactions

The individual equations can be solved as:

M = PT / V

V = PT / M

P = MV / T

T = MV / P

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