Checkable Deposits $597 Small Time Deposits 818 Currency 639 Money-Market Mutual Funds Held by Businesses 1,045 Savings Deposits, Including Money-Market Deposit Accounts 2,656 Money-Market Mutual Funds Held by Individuals 979 Refer to the accompanying table. The value of the money included in M2 but not counted in M1 is Multiple Choice $4,453 billion. $818 billion. $2,656 billion. $5,498 billion.

Checkable Deposits $597 Small Time Deposits 818 Currency 639 Money-Market Mutual Funds Held by Businesses 1,045 Savings Deposits, Including Money-Market Deposit Accounts 2,656 Money-Market Mutual Funds Held by Individuals 979 Refer to the accompanying table. The value of the money included in M2 but not counted in M1 is Multiple Choice $4,453 billion. $818 billion. $2,656 billion. $5,498 billion.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Money/Banking/The Quantity of Money Theory (Chapter 14) 1.1 What are the four functions of money? Explain each in your own words. Can something be considered money if it does not fulfill all four functions? 1.2 Using the five criteria in the textbook, explain how U.S. currency is suitable to use as a medium of exchange. 1.3 Suppose that you decide that you no longer want to hold currency, and deposit all of your currency holdings to your checking account. What is the immediate or initial impact of this transaction on M1 and M2?
Billions $ Small time deposits 1014 Money-market mutual funds held by businesses 1190 Savings deposits, including money-market deposit accounts 3649 Money-market mutual funds held by individuals 744 Checkable deposits 633 Currency 743 (a) What is the value of M1? (b) What is the value of M2?
rr = required reserve ratio = 0.15 C = currency in circulation = R200 billion D = checkable deposits = R600 billion ER = excess reserves = R0.8 billion calculate the excess reserve ratio and the money multiplier
1.Name a reason why retail Money Market Mutual Funds are not included in M1 but demand deposits and other checkable deposits are. What specific role of money does this analysis (e.g. medium of exchange, standard of value, standard of deferred payments, store of value) pertain to? 2.Passbook savings accounts and NOW accounts (part of checkable deposits) are both interest bearing bank deposits, but NOW accounts have checkable privileges and passbook savings accounts have no checkable privileges. Then why would anyone have a passbook savings deposit? Provide the economic concept behind this argument 3.Choose an interest rate other than the 3 month Treasury Bill rate or the Federal Funds rate. Provide a definition for this interest rate. Now consider the website of the Federal Reserve Economic Database (FRED), given by http://research.stlouisfred.org/fred2/. Using this database, look up the series for monthly observations for this interest rate, and provide a graph of this…
Give correct typing answer with explanation and conclusion
John withdraws $ 100 from his checking account and deposits it in his savings account. What will be the effect of this Transaction on different measures of money, i.e. C, M1, and M2?
The following data represents money from a small Island economy near Fuji. Cash in the hands of the public = $402 Public credit limit on all credit cards= 136 Demand deposits and all other checkable deposits= 693 Money market mutual funds = 618 Travelers check = 8 Large time deposits = 512 Small time deposits= 971 Public stock market holdings = 1,069 Savings-type account = 256 What is the value of M1 for this economy using data above? What is the value of M2 for this economy using data above?
10. Banks in the country of Mistania have a total of $17000 in required reserves and $276000 in checkable deposits. Calculate Mistania's required reserve ratio:
what are the changes in deposits, currency holdings and money stock for an open market sale of $1,00,000? Given that required reserve ratio is 10%, the desired excess reserve ratio is 5% and desired currency to deposit ratio is 25%.
Complete the following table to show the effect of a new deposit on excess and required reserves when the required reserve ratio is 10%. Hint: If the change is negative, be sure to enter the value as negative number. Amount Deposited (Dollars) 500,000 Change in Excess Reserves (Dollars) Change in Required Reserves (Dollars) Now, suppose Southeast Mutual Bank loans out all of its new excess reserves to Neha, who immediately uses the funds to write a check to Lorenzo. Lorenzo deposits the funds immediately into his checking account at Walls Fergo Bank. Then Walls Fergo Bank lends out all of its new excess reserves to Andrew, who writes a check to Teresa, who deposits the money into her account at PJMorton Bank. PJMorton lends out all of its new excess reserves to Beth in turn. Fill in the following table to show the effect of this ongoing chain of events at each bank. Enter each answer to the nearest dollar. Southeast Mutual Bank Walls Fergo Bank PJMorton Bank Increase in Deposits…
Using the M1 definition of Money, M1 = _____________ Category Amount Currency and coin held by the public $1,000 Checking account balances $2,000 Traveler's checks $50 Savings Account balances $4,000 Small denomination time deposits (CD) $3,000 Money market deposit accounts in banks (MMDA) $1,500 Money Market Mutual Fund Shares (MMMF) $2,500 Bitcoins $1,000 Select one: a. 7050 b. 2050 c. 3050 d. 1050
32

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Checkable Deposits	$597
Small Time Deposits	818
Currency	639
Money-Market Mutual Funds Held by Businesses	1,045
Savings Deposits, Including Money-Market Deposit Accounts	2,656
Money-Market Mutual Funds Held by Individuals	979