this chain of events shows the important relationship between the quantity of money in an economy and the general price level. the quantity theory of money states that a doubling of the supply of money will result in a doubling in the value of transactions (or income or expenditure). In the theory's more extreme form, a doubling of money will lead to a doubling of price, but not real value. Money will be neutral in its effect on the reals,relative value of goods and services- for example, on how many jackets can be bought for the price of a computer.