This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Explain what is included in M1 and M2. Is all of M1 money? Is all of M2 money? What will be an ... (Read 21 times)

mpobi80

  • Hero Member
  • *****
  • Posts: 519
on: Jun 29, 2018
Explain what is included in M1 and M2. Is all of M1 money? Is all of M2 money?
 
  What will be an ideal response?

Question 2

Suppose the real interest rate increases from 4 percent to 6 percent. As a result,
 
  A) governments decrease their demand for loanable funds.
  B) firms increase their demand for loanable funds.
  C) governments increase the supply of loanable funds.
  D) firms decrease the quantity demanded of loanable funds.
  E) governments decrease the quantity supplied of loanable funds.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

ju

  • Sr. Member
  • ****
  • Posts: 325
Reply #1 on: Jun 29, 2018
Answer to Question 1

M1 is equal to the sum of currency held by individuals and businesses plus traveler's checks plus checking deposits owned by individuals and businesses. These assets are all money because they are all a means of payment. M2 is equal to M1 plus saving deposits plus small time deposits plus money market funds. Not all of M2 is money because not all of M2 are a means of payment. In other words, some parts of M2, such as time deposits, cannot be used directly to make a purchase.

Answer to Question 2

D


mpobi80

  • Member
  • Posts: 519
Reply 2 on: Jun 29, 2018
:D TYSM

kilada

  • Member
  • Posts: 311
Reply 3 on: Yesterday
Wow, this really help

« previous next »
 

Did you know?

During the twentieth century, a variant of the metric system was used in Russia and France in which the base unit of mass was the tonne. Instead of kilograms, this system used millitonnes (mt).

Did you know?

The Babylonians wrote numbers in a system that used 60 as the base value rather than the number 10. They did not have a symbol for "zero."

Did you know?

Adolescents often feel clumsy during puberty because during this time of development, their hands and feet grow faster than their arms and legs do. The body is therefore out of proportion. One out of five adolescents actually experiences growing pains during this period.

Did you know?

More than nineteen million Americans carry the factor V gene that causes blood clots, pulmonary embolism, and heart disease.

Did you know?

Patients should never assume they are being given the appropriate drugs. They should make sure they know which drugs are being prescribed, and always double-check that the drugs received match the prescription.

Booker T. Washington in his office at Tuskegee Institute, 1900. Washington chose a policy of accommo Booker T. Washington in his office at Tuskegee Institute, 1900. Washington chose a policy of accommo
Elementary particles included in the Standard Model Elementary particles included in the Standard Model
Mechanisms to Explain the Effects of Massage Mechanisms to Explain the Effects of Massage
Please fully explain in detail Please fully explain in detail
Explain the myogenic autoregulation of the glomerular filtration rate Explain the myogenic autoregulation of the glomerular filtration rate
A debt payment of $7500 is due in 24 months. If money is worth 7.2% p.a. compounded quarterly, ... A debt payment of $7500 is due in 24 months. If money is worth 7.2% p.a. compounded quarterly, ...
Video: Neuron structure and function - sensory neurons, association neurons & motor neurons

For a complete list of videos, visit our video library