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To the reason that change which does not carry general character, favourably To separate factors mentioned by it if it occurs aside Increases, also it is unprofitable - if towards fall, If, on the contrary, The monetary wages should were are boundless to fall every time, as There would be a tendency to employment less, than complete, mentioned

Asymmetry, of course, would disappear. But in this case employment falling, as

Only it ceases to be complete, would proceed is unceasing until then,

While or the norm of percent would be already incapable to decrease further, or

The wages would not reach zero. Actually it is necessary any The factor, which cost expressed in money, would be if not It is fixed, then it is inactive to supply the known Stability of cost estimates in the conditions of money economy.

Submission about that any increase in quantity of money is

Inflationary (if we do not understand as the term inflation only that the price

Grow), it is connected with a basic assumption of the classical theory, it agree

To which we always are in conditions, in which reduction of the real Compensations of factors of production conducts to reduction of their offer.


Using the designations entered in it. 20, we can at desire To express essence of the aforesaid in the form of symbols.

Let's write MV=D where the M is quantity of money, V-speed of the circulation of money on

To the relation to incomes (this definition differs from standard in some The minor relations noted above) and D - effective demand. If V Constantly, the prices will be changed in the same proportion, as quantity Money provided that it is equal to unit.

This condition is satisfied (see above), if eit=O or if ew=1.

The condition ew=1 means that unit of wages expressed in Money, effective demand, as grows in the same proportion, as, and The condition e0=O means that the volume of output does not react more on The further increase in effective demand, as

Anyhow the volume of output remains invariable.

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