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3 years ago

Identify whether each of the following examples belongs in M1 or M2. If an example belongs in both, be sure to check both boxes.

Business

1 answer:

Mama L [17]3 years ago

7 0

Answer and Explanation:

The identification is as follows:

As we know that

M! money supply involved all the currecies that have physical existance i.e. notes, coins, demand deposits etc

While on the other hand, M2 involves M1 + near money i.e. mutual funds, checking deposits, money market etc

Since Susan has 2 year CD so it would be classified as a M2 money supply

Since larry withdraw from the bank so it would be included in M1 and M2

And, since raphael has $25,000 in money market so would be classified as a M2 money supply

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