Answer:
D) M1 falls by $1,000, and M2 is unchanged.
Explanation:
since checking account comes under M1, a transfer would result in fail, Therefore, a transfer would result in a change in M1 but shows no effect on M2
The answer to this is microprocessors. Hope this helps :D
M1 does <u>not</u> include currency held inside bank vaults (non-circulating) as well as the checkable deposits of the federal reserve, the united states treasury, and correspondent banks.
M1 is the cash supply this is composed of foreign money, demand deposits, and other liquid deposits—which incorporate savings deposits. M1 consists of the most liquid quantities of the cash delivered as it carries currency and assets that both are or may be quickly converted to coins.
M1 is a slender degree of the money supply that consists of currency, demand deposits, and other liquid deposits, including savings deposits. M1 no longer includes financial property, which includes bonds.
The M1 money supply consists of Federal Reserve notes—otherwise known as payments or paper cash—and coins that might be in stream outdoor of the Federal Reserve Banks and the vaults of depository establishments. Paper cash is the most sizeable component of a nation's cash delivery.
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