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.
Homework Answers
Question :
Answer : M1 money includes physical currency in use, therefore as a result of withdrawl M1 money increases.
M2 money includes M1 money and near money. Near money means savings deposits, mutual fund, etc. Therefore, as a result of withdrawl M2 money decreases.
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Two friends decide to go on a vacation. They withdraw $2,500
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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.
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Which of the following statements about the monetary aggregates is true? OA. 0 B. ° C. The growth rates of M1 and M2 always track each other closely. M1 is greater than M2. When the growth rate of M2 increases, the growth rate of M1 must also increase. D. When you transfer funds from your savings account to your checking account, M1 increases and M2 stays the same. Given that, in billions of U.S. dollars, we have 863.2 in currency,...
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