Which of the following is true about M1 and M2?
A. M1 includes currency, but M2 does not.
B. Neither M1 nor M2 includes money market mutual funds.
C. M2 includes saving deposits and money market mutual funds, but M1 does not.
D. M1 and M2 both include checking accounts and savings accounts.
Answer: C. M2 includes saving deposits and money market mutual funds, but M1 does not.
You might also like to view...
Vertical integration can reduce transaction costs through all of the following ways except which one?
A) establishing a partnership between the two firms B) decreasing search costs C) decreasing the incentive for litigation D) increasing the required areas of managerial expertise
Which of the following policies is supported by the idea that producers and workers will demand higher prices and wages when they see the money supply expanding?
A. Discretionary policy B. Fixed rules C. The Fed's eclecticism D. Fiscal policy
You own a building that has four possible uses: a tailor shop, a pharmacy, a sports bar, and an antique mall. The building's value in each use is $4,000; $6,000; $8,000; and $10,000, respectively. You decide to open a sports bar. The opportunity cost of using this building for a sports bar is
A. $4,000, the value if the building is used as a tailor shop. B. $20,000, the sum of the values if the building is used for a tailor shop, a pharmacy, or an antique mall. C. $6,000, the value if the building is used as a pharmacy. D. $10,000, the value if you rented the building to someone else to use as an antique mall.
Refer to Figure 4-6. What is the value of the portion of consumer surplus that has been transferred to producer surplus as a result of the price floor?
A) $1,200 B) $1,500 C) $1,800 D) $3,000