The equation for the quantity theory of money can be written as (M x Y = P x V).

Question

Quizplus · Accepted Answer

The correct equation for the quantity theory of money is M x V = P x T, where M is the money supply, V is the velocity of money, P is the price level, and T is the volume of transactions in the economy. However, in modern interpretations, the equation is often represented as M x V = P x Y, where Y represents real output or real GDP, aligning with your query but slightly differing in notation and interpretation.

The Equation for the Quantity Theory of Money Can Be