Velocity of Money Calculator

✖Nominal Gross Domestic Product is the value of all the final goods and services at current market prices.ⓘ Nominal Gross Domestic Product [NG]			+10% -10%
✖Money Supply refers to the total amount of money available in an economy at a given point in time.ⓘ Money Supply [M]			+10% -10%

✖Velocity of Money refers to the rate at which money circulates within an economy over a certain duration.ⓘ Velocity of Money [V]

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Formula

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Velocity of Money

Formula

`"V" = "NG"/"M"`

Example

`"27.7193"="15800"/"570"`

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Velocity of Money Solution

STEP 0: Pre-Calculation Summary

Formula Used

Velocity of Money = Nominal Gross Domestic Product/Money Supply
V = NG/M
This formula uses 3 Variables

Variables Used

Velocity of Money - Velocity of Money refers to the rate at which money circulates within an economy over a certain duration.
Nominal Gross Domestic Product - Nominal Gross Domestic Product is the value of all the final goods and services at current market prices.
Money Supply - Money Supply refers to the total amount of money available in an economy at a given point in time.

STEP 1: Convert Input(s) to Base Unit

Nominal Gross Domestic Product: 15800 --> No Conversion Required
Money Supply: 570 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

V = NG/M --> 15800/570

Evaluating ... ...

V = 27.719298245614

STEP 3: Convert Result to Output's Unit

27.719298245614 --> No Conversion Required

FINAL ANSWER

27.719298245614 ≈ 27.7193 <-- Velocity of Money

(Calculation completed in 00.004 seconds)

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Created by Aashna

IGNOU (IGNOU), India

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Verified by Vishnu K

BMS College of Engineering (BMSCE), Bangalore

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< 20 Macroeconomics Calculators

Operating Surplus

Go Operating Surplus = Value of Output-Intermediate Consumption-Compensation of Employees-Mixed Income-Consumption of Fixed Capital-Net Indirect Taxes

Components of Aggregate Demand

Go Components of Aggregate Demand = Private Consumption Expenditure+Investment Expenditure+Government Expenditure+Net Exports

Real Effective Exchange Rate

Go Real Effective Exchange Rate = (Consumer Price Index of Domestic Nation*Nominal Effective Exchange Rate)/Consumer Price Index of Foreign Country

Net Factor Income from Abroad

Go Net Factor Income from Abroad = Net Compensation of Employees+Net Income from Property and Entrepreneurship+Net Retained Earnings

National Disposable Income

Go National Disposable Income = National Income+Net Indirect Taxes+Net Current Transfers from the Rest of the World

Gross Domestic Product at Factor Cost

Go Gross Domestic Product at Factor Cost = Gross Domestic Product at Market Price+Subsidies-Indirect Taxes

Change in Money Supply

Go Change in Money Supply = (1/Required Reserve Ratio)*Change in Bank Reserves-(Initial Deposit Amount)

Personal Disposable Income

Go Personal Disposable Income = Personal Income-Personal Taxes-Miscellaneous Receipts of Government

Life Expectancy

Go Life Expectancy = Current Age of the Individual+Average Life Expectancy-Adjustment Factor

Private Final Consumption Expenditure

Go Private Final Consumption Expenditure = Household Final Consumption Expenditure+Non Profit Private Institutions FCE

Gross National Product at Market Price

Go Gross National Product at Market Price = Gross Domestic Product at Factor Cost+Net Factor Income from Abroad

Net Domestic Product at Factor Cost

Go Net Domestic Product at Factor Cost = Net Domestic Product at Market Price-Net Indirect Taxes

Net Domestic Product at Market Price

Go Net Domestic Product at Market Price = Gross Domestic Product at Market Price-Depreciation

Growth Rate of Money Supply

Go Growth Rate of Money Supply = Rate of Inflation+Growth Rate of Real Gross Domestic Product

Real Gross Domestic Product Per Capita

Go Real Gross Domestic Product Per Capita = Real Gross Domestic Product/Total Population

Expenditure Multiplier

Go Expenditure Multiplier = Initial Consumer Price Index/Change in Government Spending

Gross National Disposable Income

Go Gross National Disposable Income = Net National Disposable Income+Depreciation

Velocity of Money

Go Velocity of Money = Nominal Gross Domestic Product/Money Supply

Real Wage

Go Real Wage = Nominal Wage/Consumer Price Index

Simple Deposit Multiplier

Go Simple Deposit Multiplier = 1/Required Reserve Ratio

Velocity of Money Formula

Velocity of Money = Nominal Gross Domestic Product/Money Supply
V = NG/M

What do you mean by Velocity of Money ?

Velocity of Money refers to the speed at which money is spent in an economy for the purpose of buying goods and services. It is also referred to as the turnover in money supply. When an individual earns more money, he is more confident in purchasing goods, that results in increasing the money velocity.
Velocity of money indicates the state of an economy; for example, a high velocity of money indicates that money is moving fast in an economy towards the purchase of goods and services. This leads to high demand, and therefore, the production will be increased. While in a low velocity of money state, very less people will be buying things or availing less services. The money is not moving as expected, which reduces demand and as a result, production will be reduced. Higher money velocity can also cause inflation while a lower velocity results in decreasing inflation. Economists are of the view that a high velocity of money is indicative of a favourable economy while a low velocity of money signifies recessions

How to Calculate Velocity of Money?

Velocity of Money calculator uses Velocity of Money = Nominal Gross Domestic Product/Money Supply to calculate the Velocity of Money, Velocity of Money is defined as the speed at which money flows or is exchanged in an economy. Velocity of Money is denoted by V symbol.

How to calculate Velocity of Money using this online calculator? To use this online calculator for Velocity of Money, enter Nominal Gross Domestic Product (NG) & Money Supply (M) and hit the calculate button. Here is how the Velocity of Money calculation can be explained with given input values -> 26.31579 = 15800/570.

FAQ

What is Velocity of Money?

Velocity of Money is defined as the speed at which money flows or is exchanged in an economy and is represented as V = NG/M or Velocity of Money = Nominal Gross Domestic Product/Money Supply. Nominal Gross Domestic Product is the value of all the final goods and services at current market prices & Money Supply refers to the total amount of money available in an economy at a given point in time.

How to calculate Velocity of Money?

Velocity of Money is defined as the speed at which money flows or is exchanged in an economy is calculated using Velocity of Money = Nominal Gross Domestic Product/Money Supply. To calculate Velocity of Money, you need Nominal Gross Domestic Product (NG) & Money Supply (M). With our tool, you need to enter the respective value for Nominal Gross Domestic Product & Money Supply and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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