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Additional Exercise 5 (Ch. 16 - 18) 1.Which of the following lists is included in what economists call “money”? a. Cash* b. cash and stocks and bonds c. cash and stocks and bonds and real estate d. cash and stocks and bonds and real estate and all other assets 2.You receive money as payment for babysitting your neighbors' children. This best illustrates which function of money? 3.Paper dollars a. are commodity money and gold coins are fiat money. b. are fiat money and gold coins are commodity money.* c. and gold coins are both commodity monies. d. and gold coins are both fiat monies. 4.Which of the following is not included in M1? 5.Given the following information, what are the values of M1 and M2? S m a ll ti m e d e p o s it s \$650 billion D \$300 billion

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e m a n d d e p o s it s a n d o t h e r c h e c k a b l e d e p o s it s S a v i n g s d e p \$750 billion
o s it s M o n e y m a r k e t m u t u a l f u n d s \$600 billion T r a v e l e r' s c h e c k s \$25 billion L a r g e \$600 billion

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ti m e d e p o s it s C u r r e n c y \$100 billion M i s c e ll a n e o u s c a t e g o r i e s i n M 2 \$25 billion a . M1 = \$400 billion, M2 = \$2,475 billion.
b . M1 = \$125 billion, M2 = \$3,025 billion. c . M1 = \$425 billion, M2 = \$2, 450 billion.* d . M1 = \$425 billion, M2 = \$1,875 billion. 6.At the Federal Reserve, 7.A bank loans Kellie's Print Shop \$350,000 to remodel a building near campus to use as a new store. On their respective balance sheets, this loan is a. an asset for the bank and a liability for Kellie's Print Shop. The loan increases the money supply.* b. an asset for the bank and a liability for Kellie's Print Shop. The loan does not increase the money supply. c. a liability for the bank and an asset for Kellie's Print Shop. The loan increases the money supply. d. a liability for the bank and an asset for Kellie's Print Shop. The loan does not increase the money supply.

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