If people withdraw $10 million from the nation's money market mutual funds and redeposit the funds in various checkable and debitable accounts, then
A) M1 and M2 will remain unchanged.
B) M1 will increase, M2 will remain unchanged.
C) M1 will increase, M2 will decrease.
D) M1 and M2 will increase.
Ans: B) M1 will increase, M2 will remain unchanged.
Economics
You might also like to view...
The purpose of the Labor Side Agreement under NAFTA is to:
a. increase standards in Mexico only. b. increase standards throughout NAFTA. c. enforce existing standards throughout NAFTA. d. renegotiate standards.
Economics
Refer to the diagram for a private closed economy. Aggregate saving in this economy will be zero when:
A. C + I g cuts the 45-degree line.
B. GDP is $180 billion.
C. GDP is $60 billion.
D. GDP is also zero.
Economics