The second equation of exchange is__________
- MV = PT
-
P = \(\frac {M}{KR}\)
- P = \(\frac {MV}{T}\)
- P=MV
The correct answer is: B
Explanation
The second equation of exchange of money is P = \(\frac {M}{KR}\)
Where : P = Price level of consumer goods
K = The proportion of the community's total income held in money
R = The real income
M = The stock of money.