The concept that shows the relationship among GDP,the money stock,and the velocity of circulation of money is called the

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The equation of exchange, also known as the quantity theory of money, shows the relationship between the money stock, velocity of circulation of money, and GDP. It states that MV = PQ, where M is the money stock, V is the velocity of circulation of money, P is the price level, and Q is the real output or GDP. This equation shows that changes in the money supply or velocity of circulation affect the economy through changes in prices and output.

The Concept That Shows the Relationship Among GDP,the Money Stock,and