[{"data":1,"prerenderedAt":246},["ShallowReactive",2],{"term:velocity-of-money":3},{"term":4,"related":237},{"id":5,"title":6,"body":7,"category":220,"description":221,"extension":222,"faq":223,"meta":224,"navigation":225,"path":226,"related":227,"seo":230,"stem":231,"takeaways":232,"__hash__":236},"terms\u002Fterms\u002Fvelocity-of-money.md","Velocity of Money",{"type":8,"value":9,"toc":214},"minimark",[10,15,19,22,26],[11,12,14],"h2",{"id":13},"understanding-velocity-of-money","Understanding Velocity of Money",[16,17,18],"p",{},"Velocity equals nominal GDP divided by the money supply. If GDP is $30 trillion and the money supply is $15 trillion, each dollar is spent on average twice a year.",[16,20,21],{},"Velocity changes with interest rates, payment technology and confidence; it fell sharply in 2020 as people held more cash.",[11,23,25],{"id":24},"formula","Formula",[27,28,31],"span",{"className":29},[30],"katex-display",[27,32,35,80],{"className":33},[34],"katex",[27,36,39],{"className":37},[38],"katex-mathml",[40,41,44],"math",{"xmlns":42,"display":43},"http:\u002F\u002Fwww.w3.org\u002F1998\u002FMath\u002FMathML","block",[45,46,47,75],"semantics",{},[48,49,50,54,58],"mrow",{},[51,52,53],"mi",{},"V",[55,56,57],"mo",{},"=",[59,60,61,72],"mfrac",{},[48,62,63,66,69],{},[51,64,65],{},"P",[55,67,68],{},"×",[51,70,71],{},"Y",[51,73,74],{},"M",[76,77,79],"annotation",{"encoding":78},"application\u002Fx-tex","V = \\frac{P \\times Y}{M}",[27,81,85,112],{"className":82,"ariaHidden":84},[83],"katex-html","true",[27,86,89,94,100,105,109],{"className":87},[88],"base",[27,90],{"className":91,"style":93},[92],"strut","height:0.6833em;",[27,95,53],{"className":96,"style":99},[97,98],"mord","mathnormal","margin-right:0.2222em;",[27,101],{"className":102,"style":104},[103],"mspace","margin-right:0.2778em;",[27,106,57],{"className":107},[108],"mrel",[27,110],{"className":111,"style":104},[103],[27,113,115,119],{"className":114},[88],[27,116],{"className":117,"style":118},[92],"height:2.0463em;vertical-align:-0.686em;",[27,120,122,127,210],{"className":121},[97],[27,123],{"className":124},[125,126],"mopen","nulldelimiter",[27,128,130],{"className":129},[59],[27,131,135,201],{"className":132},[133,134],"vlist-t","vlist-t2",[27,136,139,196],{"className":137},[138],"vlist-r",[27,140,144,159,170],{"className":141,"style":143},[142],"vlist","height:1.3603em;",[27,145,147,152],{"style":146},"top:-2.314em;",[27,148],{"className":149,"style":151},[150],"pstrut","height:3em;",[27,153,155],{"className":154},[97],[27,156,74],{"className":157,"style":158},[97,98],"margin-right:0.109em;",[27,160,162,165],{"style":161},"top:-3.23em;",[27,163],{"className":164,"style":151},[150],[27,166],{"className":167,"style":169},[168],"frac-line","border-bottom-width:0.04em;",[27,171,173,176],{"style":172},"top:-3.677em;",[27,174],{"className":175,"style":151},[150],[27,177,179,183,186,190,193],{"className":178},[97],[27,180,65],{"className":181,"style":182},[97,98],"margin-right:0.1389em;",[27,184],{"className":185,"style":99},[103],[27,187,68],{"className":188},[189],"mbin",[27,191],{"className":192,"style":99},[103],[27,194,71],{"className":195,"style":99},[97,98],[27,197,200],{"className":198},[199],"vlist-s","​",[27,202,204],{"className":203},[138],[27,205,208],{"className":206,"style":207},[142],"height:0.686em;",[27,209],{},[27,211],{"className":212},[213,126],"mclose",{"title":215,"searchDepth":216,"depth":216,"links":217},"",2,[218,219],{"id":13,"depth":216,"text":14},{"id":24,"depth":216,"text":25},"economy","How many times a unit of money is spent on final goods and services in a period.","md",[],{},true,"\u002Fterms\u002Fvelocity-of-money",[228,229],"quantity-theory-of-money","gdp",{"title":6,"description":221},"terms\u002Fvelocity-of-money",[233,234,235],"Velocity = nominal GDP ÷ money supply.","It is the V in MV = PY.","It is far from constant in the short run.","RkfFJicIxL5zoOAsJ7creqnDyciZnM9oodOHHl9-Vio",[238,242],{"title":239,"description":240,"path":241},"Gross Domestic Product (GDP)","The total value of goods and services produced in a country over a period.","\u002Fterms\u002Fgdp",{"title":243,"description":244,"path":245},"Quantity Theory of Money","The idea that money supply times its velocity equals the price level times real output.","\u002Fterms\u002Fquantity-theory-of-money",1793374006177]