BUS051 HW14

BUS051 HW14 - Sharon Ng Professor Henderson BUS051 20 July 2011 Lesson 14 Homework Amy Mendoza a Minnesota native has recently been elected to the

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Sharon Ng Professor Henderson BUS051 20 July 2011 Lesson 14 Homework Amy Mendoza, a Minnesota native, has recently been elected to the U.S. House of Representatives. Amy, a long-time college professor, was elected on a platform of educational reform. Somehow, Amy finds herself appointed to the Joint Economic and Financial Services Committees. Amy is having a hard time understanding the testimony before each committee, but is hesitant to ask too many questions. 1. On his first day, there is a discussion of M-1 and M-2. Amy doesn't have a clue what they are talking about. Explain M-1 and M-2. Answer: M-1 is the measure of the money supply that only includes the most liquid (spendable) forms of money. M-2 is a measure of the money supply that includes all the components of M-1 plus the forms of money that can be easily converted to spendable forms. 2. Several days later, there is discussion of a bill raising insurance on bank deposits. Explain to Amy who insures bank deposits and the current limit. Answer: The FDIC insures bank deposits. The FDIC is a federal agency that guarantees the
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This note was uploaded on 08/30/2011 for the course BUS 51 taught by Professor Henderson during the Summer '11 term at West Valley.

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