• Keynes reformulated the Quantity Theory of Money.
• In his opinion the quantity of money does not directly affect price level.
• A change in the quantity of money may lead to a change in the rate of interest.
• With a change in the rate of interest the volume of investment is quite likely to change.
• A change in investment will lead to a change in income, output and employment and also a change in cost of production.
• This will lead to the change in prices of goods and services.
• The Keynesian version of the Quantity Theory integrates monetary theory with the general theory of value