Answer:
C. basic quantity equation of money
Explanation:
MV = PQ
M = Money Supply ; V = Velocity of Circulation ; P = Price Level ; Q = Transactions
This is the equation given as per 'Fisher's Quantity Theory of Money' .
The theory states that : total money supply with its circulation rate is equal to = total money demand of the total value of transactions i.e Price x Quantity (no. of transactions).
The theory also highlights that : As money supply (M) increases, Price (P) also increases and the value / purchasing power of money falls.
