Ambiguities in the meaning and measurement of the money supply If the central ba

Question

Ambiguities in the meaning and measurement of the money supply If the central bank pursues an expansionary monetary policy, the growthe rate of the money supply is likely to________Which of the following changes would likely lead to an increase in the Ml money supply in the United States? Check all that apply. Many people decide to shift their money from savings account deposits to interest-earning checking accounts. The recent financial crisis has led people to store their money in demand deposits rather than investing in money market mutual funds. Many businesses decide to accept cash or checks only, due to the increasing incidence and seventy of credit card fraud. The U.S. dollar has become more popular among developing countries, and citizens in those countries increasingly use the dollar in their daily transactions.

Explanation / Answer

MANY PEOPLE DECIDE TO SHIFT THEIR MONEY FROM SAVINGS ACCOUNT DEPOSITST O INTEREST-EARING CHECKING DEPOSITS.

THE RECENT FINANCIAL CRISIS HAS LEAD PEOPLE TO STORE THEIR MONEY IN DEMAND DEPOSITS RATHER THAN INVESTING IN MONEY MARKET MUTUAL FUNDS.

MANY BUSINESS DECIDE TO ACCEPT CASH OR CHECKS ONLY,DUR TO INCREASING INCIDENCE OFAND SEVERITY OF CREDIT CARD FRAUD.

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