Banking and Financial Terms: VELOCITY OF CIRCULATION OF MONEY : - TopicsExpress

Banking and Financial Terms: VELOCITY OF CIRCULATION OF MONEY : An important aspect of money like the quantity is its velocity which refers to the number of times money is used to buy final output of goods and services. It measures the rapidity with which money changes hands and circulating through the economy during a given period. Income velocity, that is payment for goods and services, is usually measured by dividing national income at current prices for a given year by the sum of total money in circulation.

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