ECO 210 Chp 10 HA

ECO 210 Chp 10 HA - d) travelers check holdings are M1 e)...

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Macroeconomics 210 Chapter 10: Money, Banks, and the Federal Reserve Homework Assignment Chapter 10 (pg. 354 #1.3; pg. 355 #2.3, 2.4) 1.3) a) Medium of Exchange Unit of Account Store of Value Standard of Deferred Payment b) Anything used as money should fulfill all four functions. 2.3) a) currency in circulation is counted as M1 b) checking account deposits are counted as M1 c) savings account deposits are counted as M2
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Unformatted text preview: d) travelers check holdings are M1 e) CitiBank Platinum MasterCard is not part of the money supply. 2.4) When you deposit the $2,000 cash into a checking account, currency in circulation (M1) decreases, and checking account deposits (M1) increases. Therefore, M1 is unchanged. If M1 is unchanged and no actions are taken in M2, M2 remains unchanged also....
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This note was uploaded on 01/14/2012 for the course ECO 210 taught by Professor Morvey during the Fall '10 term at Piedmont TC.

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