Homework Answers
M1 includes cash and checking deposits.
M2 is the money supply that includes all elements of M1 plus the near money (savings deposits, money market securities, mutual funds, and other time deposits). These assets are less liquid than M1 and not as suitable as exchange mediums, but they can be quickly converted into cash or checking deposits.
Thus M1 is more liquid than M2.
(1) M1 increases, M2 decreases, and the system becomes more liquid.
(2) U.S Treasury Bonds
(3) a fraction of total deposits
(The reserve requirement is the total amount of funds a bank must have on hand each night. It is a percentage of the bank's deposits. The nation's central bank sets the percentage rate.)
(4) All of the above
(The 12 government banking institutions that form the core of the U.S. Federal Reserve System and are responsible for supervising, regulating, and interacting with commercial banks and carrying out the policies established by the Federal Reserve Board of Governors.)
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If Mrs. Ethridge moves $3,000 from her savings account into her checking account: M1 stays the...
Say I move $100 from my savings account to my checking account. Which of the following...
Say I move $100 from my savings account to my checking account. Which of the following is true? O M1 increases while M2 decreases M1 increases while M2 stays the same O M1 and M2 both increase M1 and M2 both decrease Question 17 (12 points) Which of the below was most responsible for the virtual elimination of bank runs in the US? lower discount rates FDIC deposit insurance lower reserve requirements deregulation of the banking sector
Two friends decide to go on a vacation. They withdraw $2,500 from their savings account. As...
Two friends decide to go on a vacation. They withdraw $2,500 from their savings account. As a result of this transfer by itself A. M1 decreases by $2,500 and M2 stays the same. B. M1 increases by $2,500 and M2 stays the same. C. M1 decreases by $2,500 and M2 decreases by $2,500. D. M1 increases by $2,500 and M2 decreases by $2,500.
3. Terry takes $100 from his checking account and deposits the $100 in his savings account....
3. Terry takes $100 from his checking account and deposits the $100 in his savings account. What is the immediate change in M1 and M2? Show your work Formula Calculation Answer Question 5 0.17 pts 3. When Terry takes $100 from his checking account and deposits the $100 in his savings account, the immediate change in M1 is O M1 increases by $100 O M1 decreases by $100 O M1only decreases by $50 O M1 does not change.
Jane currently has $5,100 in her savings account and $2,000 in her checking account at the...
Jane currently has $5,100 in her savings account and $2,000 in her checking account at the local bank. Instructions: Use a positive number to represent an increase and a negative number to represent a decrease. a. Suppose she withdraws $350 in cash from her savings account. By what dollar amount does the country's money supply (M1 and M2) change as a result of Jane's actions? Change in M1: $____ Change in M2: $____ b. Now suppose instead that Jane withdraws...
2. Monica transfers $10,000 from her savings account at the Bank of Alaska to her money...
2. Monica transfers $10,000 from her savings account at the Bank of Alaska to her money market fund. What is the immediate change in M1 and M2? Show your work. Formula Calculation Answer Question 3 0.17 pts 2. When Monica transfers $10,000 from her savings account to her money market account, the immediate change in M1 is: O M1 increases by $10,000. o M1 decreases by $10,000. O M1 only increases by $5,000 O M1 does not change.
pls do 35-40 35. When moving $500 from your checking account to your savings account this...
pls do 35-40
35. When moving $500 from your checking account to your savings account this transaction will impact the M1 and M2 money supplies by a. decreasing the M1 by $500. The M2 will be unchanged. b. decreasing the M1 by $500 and increasing the M2 by $500. c. not affecting the M1. But the M2 will increase by $500. d. not affecting the M1 and M2. Both will be unchanged. 36. The funds that banks are required by...
answer every single picture QUESTION 5 Suppose James transfers $500 from his checking account to...
answer every single picture
QUESTION 5 Suppose James transfers $500 from his checking account to his savings account. As a result of this action, OM1 stays the same and M2 falls. M1 falls and M2 stays the same. OBoth M1 and M2 fall. OBoth M1 and M2 stay the same. We were unable to transcribe this image1 poi QUESTION 7 Suppose the required reserve ratio is 25%. Assuming that banks hold no excess reserves and consumers hold no cash, this...
2. Multiple Choice Question #2 Sara withdraws $2,000 from her small time deposit account at Bank...
2. Multiple Choice Question #2 Sara withdraws $2,000 from her small time deposit account at Bank of America, keeps $400 in cash, and deposits the rest in her checking account at Citibank. What is the immediate change in M1 and M2? O M1 increases by $400 and M2 decreases by $400. O M1 and M2 increase by $2,000. O M1 increases by $2,000 and there is no change in M2. O M1 increases by $2,000 and M2 decreases by M2.
Maureen withdraws $80 in cash from her savings account. How are M1 and M2 affected? A....
Maureen withdraws $80 in cash from her savings account. How are M1 and M2 affected? A. M1 rises by $80. M2 falls by $80 B. Both M1 and M2 fall by $80 C. Nothing happens to M1 or M2. D. M1 rises by $80. Nothing happens to M2.
Please answer all questions. 16) When compared to exchange systems that rely on money, disadvantages of...
Please answer all questions.
16) When compared to exchange systems that rely on money, disadvantages of the barter system include A) lowering the cost of exchange to those who would specialize. B) encouraging specialization and the division of labor. C) lowering the cost of exchanging goods over time. D) the requirement of a double coincidence of wants. 17) Which of the following is NOT included in the M1 measure of money but is included in the M2 measure of money?...
Say I move $100 from my savings account to my checking account. Which of the following is true? O M1 increases while M2 decreases M1 increases while M2 stays the same O M1 and M2 both increase M1 and M2 both decrease Question 17 (12 points) Which of the below was most responsible for the virtual elimination of bank runs in the US? lower discount rates FDIC deposit insurance lower reserve requirements deregulation of the banking sector
3. Terry takes $100 from his checking account and deposits the $100 in his savings account. What is the immediate change in M1 and M2? Show your work Formula Calculation Answer Question 5 0.17 pts 3. When Terry takes $100 from his checking account and deposits the $100 in his savings account, the immediate change in M1 is O M1 increases by $100 O M1 decreases by $100 O M1only decreases by $50 O M1 does not change.
2. Monica transfers $10,000 from her savings account at the Bank of Alaska to her money market fund. What is the immediate change in M1 and M2? Show your work. Formula Calculation Answer Question 3 0.17 pts 2. When Monica transfers $10,000 from her savings account to her money market account, the immediate change in M1 is: O M1 increases by $10,000. o M1 decreases by $10,000. O M1 only increases by $5,000 O M1 does not change.
pls do 35-40
35. When moving $500 from your checking account to your savings account this transaction will impact the M1 and M2 money supplies by a. decreasing the M1 by $500. The M2 will be unchanged. b. decreasing the M1 by $500 and increasing the M2 by $500. c. not affecting the M1. But the M2 will increase by $500. d. not affecting the M1 and M2. Both will be unchanged. 36. The funds that banks are required by...
answer every single picture
QUESTION 5 Suppose James transfers $500 from his checking account to his savings account. As a result of this action, OM1 stays the same and M2 falls. M1 falls and M2 stays the same. OBoth M1 and M2 fall. OBoth M1 and M2 stay the same. We were unable to transcribe this image1 poi QUESTION 7 Suppose the required reserve ratio is 25%. Assuming that banks hold no excess reserves and consumers hold no cash, this...
2. Multiple Choice Question #2 Sara withdraws $2,000 from her small time deposit account at Bank of America, keeps $400 in cash, and deposits the rest in her checking account at Citibank. What is the immediate change in M1 and M2? O M1 increases by $400 and M2 decreases by $400. O M1 and M2 increase by $2,000. O M1 increases by $2,000 and there is no change in M2. O M1 increases by $2,000 and M2 decreases by M2.
Maureen withdraws $80 in cash from her savings account. How are M1 and M2 affected? A. M1 rises by $80. M2 falls by $80 B. Both M1 and M2 fall by $80 C. Nothing happens to M1 or M2. D. M1 rises by $80. Nothing happens to M2.
Please answer all questions.
16) When compared to exchange systems that rely on money, disadvantages of the barter system include A) lowering the cost of exchange to those who would specialize. B) encouraging specialization and the division of labor. C) lowering the cost of exchanging goods over time. D) the requirement of a double coincidence of wants. 17) Which of the following is NOT included in the M1 measure of money but is included in the M2 measure of money?...
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