1 Comments:

 John. said...

Thank you for this video, very helpful, summarises perfectly what has been recently happening.

Just a question though, MsV = PY, right? So now Ms is increasing, whereas V is decreasing. If V decreases more than Ms increases, then deflation is likely to occur, with P going down. How about Y? It is also likely to go down, is that correct?

Ms - money supply; V - velocity; P - price level; Y - income level.

Any comments about Fisher's theory of price level would be much appreciated.

Cheers,
John
(A6 student)

March 16, 2009 2:15 AM  

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