Which of the following statements are true regarding the differences between M1+ and M2? Instructions: You may select more than one answer. Click the box with a check mark for correct answers, and click to empty the box for the wrong answers. ? M1+ Includes cash and reserves, whereas M2 does not. ? M2 represents a broader measure of the money supply than M1+. 2 Numerically, M1+ Is larger than M2. All Items in M1+ are more liquld than all Items In M2. ? M2 Includes savings deposits, whereas M1+ does not. During the recent recession, M1+ was a more stable measure of the money supply than M2.

Which of the following statements are true regarding the differences between M1+ and M2? Instructions: You may select more than one answer. Click the box with a check mark for correct answers, and click to empty the box for the wrong answers. ? M1+ Includes cash and reserves, whereas M2 does not. ? M2 represents a broader measure of the money supply than M1+. 2 Numerically, M1+ Is larger than M2. All Items in M1+ are more liquld than all Items In M2. ? M2 Includes savings deposits, whereas M1+ does not. During the recent recession, M1+ was a more stable measure of the money supply than M2.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose the desired reserve ratio in Canada is 15%. Assume that the Bank of Canada has decided to increase the total quantity of money in the economy-as measured by M1-by $150 million. The Bank plans to do this by printing Canadian dollars. How much money must the Bank print to increase the money supply by the desired amount? (Calculate your answer in millions of CAD, round it to two decimal places, and write it without units. E.g., write 1.00 for $1 million.)
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In December 2000, currency was $340 billion, travelers checks were $4 billion; checkable deposits owned by individuals and businesses were $450 billion, saving deposits were $1,900 billion, time deposits were $1,000 billion; and money market funds were $900 billion. What was the M1 in December 2000?
1. What is money? Discuss the characteristics of money as medium of exchange, unit of account, store of value, and means of deferred payment. 2. Define M1 and M2 3. Describe the money multiplier and explain how it works. Give examples for each one.
MONEY IN THE ECONOMY ($billions) Currency held by the public = $1,000 Demand Deposits = $3,000 Other Liquid Deposits = $12,000 Small Denomination Time Deposits = $500 Retail Money Market Funds = $1,500 Based on the information above, the money supply as measured by M1 is equal to: Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a $1,000 billion. b $4,000 billion. C $16,000 billion. d $18,000 billion. X Your answer
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