The Theory of Money

 There is a formula we use for money. The first thing we will look at is the variables. The first is V, the velocity of money, or how many times money changes hands. The second is M, which is just money. The third is Y, which all the goods and services sold in an economy. Finally, we have the fourth variable, P, which is the price of these goods and services. The formula itself is V x M = P x Y. This used very frequently in economics.