Q.In Fisher's equation of exchange, MV = PT, the symbol 'V' stands for:

Each symbol in Fisher's equation has a specific, fixed meaning that must not be confused with a similar-sounding term. …

Fisher's equation of exchange is $MV = PT$, where every symbol has one fixed meaning: $M$ = the total quantity of money in circulation, $V$ = the velocity of circulation of money (the average number of times a unit of money changes hands in a given period), $P$ = the general price level, and $T$ = the total volume (physical quantity) of transactions.

Checking each option against this:

• (a) Value of goods — this is closer to what $PT$ (the right-hand side as a whole) represents, not $V$ alone.
• (b) Volume of money — this describes $M$, not $V$. …

Confusing 'V' (velocity, a speed-of-circulation concept) with 'volume' of money, which is what M itself already represents — the two terms so …