Source: http://thebadeconomist.com/2011/03/04/money-neutrality-or-the-quantity-equation/
Friday 18 November 2011
Money Neutrality (or, the Quantity Equation)
The Macro class I’m TAing has just gotten to money growth and inflation, chapter 12 in Mankiw’s Brief Principles of Macroeconomics. As usual, the quantity equation, MxV = PxY, confuses some of the students a little bit, so I thought I’d see what I can do to clarify it a little. First, let’s define some [...]
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