Author Question: Suppose you transfer 1,000 from your checking account to your savings account. How does this action ... (Read 110 times)

student77 · **on:** Jun 30, 2018

Suppose you transfer 1,000 from your checking account to your savings account. How does this action affect the M1 and M2 money supplies?
a. M1 and M2 are both unchanged.
b. M1 falls by 1,000 . and M2 rises by 1,000.
c. M1 is unchanged, and M2 rises by 1,000.
d. M1 falls by 1,000 . and M2 is unchanged.

Question 2

Which of the following statements is true?
a. The doctrine of laissez-faire advocates an economic system with extensive government intervention and little individual decision-making.
b. In capitalism income is distributed on the basis of need.
c. Adam Smith was the father of socialism.
d. Most real-world economies are mixed economic systems.
e. The invisible hand refers to government economic control.