Monetary velocity in the Canadian economy.

The method to discover the more important factors causing the movements in income-velocity is to examine the determinants of the demand for money. In the cash balance terminology of the Cambridge equation, k=M/Y real money balances are set equal to real monetary income times a number, k. The k, in the cash balance equation is the reciprocal of velocity. Any analysis in terms of the proportion that desired cash balances bear to income or total transactions can easily be restated in terms of the velocity of money