A single dollar as it circulates helps to supply the monetary demand of many individuals in turn: the more quickly each person spends the piece of money he receives, the greater its rapidity of circulation.

Let us suppose that every piece of money passed from one person to another once each day.

Then a dollar would, in the course of a business year (about 300 days), serve to buy (and at the same time to sell) $300 worth of goods.

If the average purchases of each individual amounted to $1000 a year, the average monetary demand of each would be about 3-1/3 dollars.
But every moment beyond the average time that any one kept money would increase his monetary demand.

If he delayed a day, a week, or a month in spending the money, waiting until he could buy in some other market, or until a better time to buy, he would thus increase insomuch the amount of money needed to make the trade (on that scale of prices).