The amount of this quantity increases when banks can lend, according to the multiplier effect.
The amount of this quantity increases when banks can lend, according to the multiplier effect. One theory of this is based on an equation which contains the product of the average price level and the volume of transactions, the Fisher Equation; that theory is known as the "quantity theory" of this. The rate at which this is exchanged is called its velocity. The three aggregates of this quantity include bank deposits, savings accounts, and repurchase agreements, and are known as M1, M2, and M3. By Gresham's law, bad amounts of it drive out good amounts at a fixed rate of exchange. For 10 points, name this staple of the economy consisting of coins and banknotes.
The amount of this quantity increases when banks can lend, according to the multiplier effect.
money