Why is there more than one definition of the money supply? What is the difference between them?
There is no one "correct" definition of the money supply because there is no clear distinction between money and "near money." M1 focuses on money's role as a medium of exchange. M2 and M3 include other assets that can be readily converted into the medium of exchange. The more inclusive the definitions, the less liquid the assets that are counted.
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According to the graph shown, if this economy were open to free trade, domestic consumers would consume how many units?
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
A. 45
B. 85
C. 120
D. 75
If a tax is increased, a. consumers will pay a higher price
b. consumers will lose consumer surplus. c. producers will receive a lower price after taxes. d. all of the above are true.
The distinction between market wages and marginal wages must be made because of the downward slope of the labor demand curve.
Answer the following statement true (T) or false (F)
From 1999-2001, the U.S. Federal Reserve ___ nominal interest rates, and it ___ the policy in 2001 due to concerns over ___
a. lowered; continued; recession b. raised; reversed; inflation c. raised; reversed; recession d. lowered; continued; inflation