Page:Indian Journal of Economics Volume 2.djvu/102

 D. A. BAKZ thed by be pull of s lever, the other end of which is &i- s string T to the cylinder DE, so that movement-of the piston-heaA will tend revolve DE in. the direction EF. downward seen that the pull of the weiglt the piston-head G upwards, whilst of movement weight W upwards. It w the piston-head will tend Now suppose the cylinder A and will thus tends to downward to pull the the pipe represent represent C B to be full gold, and let the import of of water.' Let this water the .flow of water into A gold. Then the height of the piston-head, or the level of water in A, will repre- sent the level of prices, whilst the &re of the end of A represents the volume of trsAe. The pull exerted by the weight W represents the rate of interest and the pull on the string T represents the rate of discount We thus see that an influx of gold into A will, other things being equal, raise the' level of prices;