The second equation of exchange is?

A. MV = PT
B. P = MK/R
C. P = MV/T
D. P=MV

Correct Answer: Option B

B. P = MK/R

Explanation

The second equation of exchange of money is P = MK/R
Where : P = Price level of consumer goods
K = The proportion of the community’s total income held in money
R = The real income
M = The stock of money.