Cambridge quantity theory of money (HINDI)

Cambridge cash-balance approach was based on the store of value function of money. According to the cash-balance approach, the demand for money and the supply of money determines the value of money. This approach considers the demand for money and supply of money at a particular moment of time. Since at a particular moment the supply of money is fixed, it is the demand for money which largely accounts for the changes in the price level. As such, the cash-balance approach is also called the demand theory of money. MV = KPY or P = M/KY Where: M is the supply of money (currency plus demand deposits) P is the price level Y is aggregate real income; and K is the fraction of the real income which the people desire to hold in the form of money. The price level (P) is directly proportional to the money supply (M), the price level (P) is indirectly proportional to the aggregate real income (Y) and the proportion of the real income which people desire to keep in the form of money (K). M and Y being constant, with the increase in K price level (P) falls and with the decreases in K price level (P) rises K and Y remains unchanged, if the supply of money (M) increases, price level (P) rises and if the supply of money (M) decreases, price level (P) falls. #YOUCANLEARNECONOMICS #ECONOMICS Subscribe me @    / ezclassesfaghsa   Like me on Facebook @   / faghsa   Follow me on Twitter @ https://twitter.com/?lang=en Mail ID: faghsa1760@gmail.com