Save Question 16 (1 point) The M1 measure of the money supply equals O A) curren

Question

Save Question 16 (1 point) The M1 measure of the money supply equals O A) currency plus checking account balances plus traveler's checks plus savings account balances. B) currency plus checking account balances. O c) currency plus checking account balances plus traveler's checks. D) paper money plus coins in circulation. Save Question 17 (1 point) The M2 measure of the money supply equals O A) None of the above. O B) savings account balances plus small-denomination time deposits plus traveler's checks. C) savings account balances plus small-denomination time deposits plus noninstitutional money market fund shares. ) M1 plus savings account balances plus small-denomination time deposits plus noninstitutional money market fund shares. Save Question 18 (1 point) If the required reserve ratio (RR) is 10 percent, the simple deposit multiplier is A) 1. ) 5. O c 10. D) 20. Save

Explanation / Answer

Q16
Option C
M1=currency plus checking account balances plus traveler's checks
this is most liquid money

Q17
Option D
M2=M1+saving account balances plus small time denominations+non institutional money market funds
this is most liquid plus close to the liquid money

Q18
option c
the money multiplier=1/reserve ratio=1/0.1=10

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