Money demand function

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Money demand function is a function showing the determinants of the demand for real money balances; for example, (M/P)d � L(i,Y). Money multiplier]]. The increase in the money supply resulting from a one-dollar increase in the monetary base.

Definition

According to Macroeconomics by Mankiw (7th edition),

Money demand function. A function showing the determinants of the demand for real money balances; for example, (M/P)d � L(i,Y). Money multiplier]]. The increase in the money supply resulting from a one-dollar increase in the monetary base.
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