Question 2Jaime transfers $2,500 from his checking account to his savings account. This transaction willSelect one:a. decrease both M1 and M2.b. increase both M1 and M2.C. decrease M1 and not change M2.d. not change M1 and decrease M2.

Checking account comes under M1 and saving account comes under M2.

Answered: Jaime transfers $2,500 from his…

Business

Economics

Jaime transfers $2,500 from his checking account to his savings account. This transaction will

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter27: Money And Banking

Section: Chapter Questions

Problem 29P: If you take 100 out of your piggy bank and deposit it in your checking account, how did M1 change?...

See similar textbooks

Related questions

Q: Find the new deposit when the required reserve ratio is 20% and the initial change in the volume of…

Q: Identify briefly five questions a money manager should ask before recommending suitable investments…

A: Money manager is the financial advisor that helps its clients to invest their money in appropriate…

Q: Set forth and describe two of the basic qualities needed for any item to be used as money.

A: Money is a resource or asset that is accepted and used as an exchange medium to buy commodities and…

Q: Suppose on your 21st birthday, your eccentric grandmother invites you to her house, takes you into…

A: The M1 and M2 are the two different measures of the money supply in the economy. The M1 is known as…

Q: How much of account verification costs will be assigned to Department A?

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: commodity money that has been used in different times in the history

A: Money can be defined as an asset with monetary characteristics which is generally accepted as a…

Q: money is a concept has a certain value at a point in time. true or false

A: Money is the concept that money you have in present is worth more than the identical sum in the…

Q: What challenges would you face if we lived in a society without money and would require a barter…

A: Barter system is a economic system where goods are exchanged in terms of another goods.

Q: It is not smart to make small purchases on a credit card because they can pile up and end up costing…

A: When talking about credit card, it is the facility provided by financial institutions to the people…

Q: What are some currencies of great value in a workplace that is in high demand? List at least 3 and…

A: Commonly, the value of different currencies around the global financial market keeps on changing…

Q: Your friend Tim wants to open a checking account, but he's not sure how to do it. List the steps.

A: A checking account is a sort of bank account that enables you to deposit and receive money for…

Q: Find the new deposits when the required reserve ratio is 20% and the initial change in the volume of…

A: Bank deposit and required reserve ratio plays very important role in credit creation process of…

Q: How transactions between suppliers and users of funds take place? How would they prove that there…

A: The suppliers and user of funds demand funds as they lack the necessary capital and need large pool…

Q: Factors that influence the use of money vs credit cards.

A: Money: Money is an widely accepted instrument used as measure of value, a medium of exchange, a…

Q: What are differences between digital cash and cryptocurrency?

A: Digital Cash and Cryptocurrency is intangible money which cannot be seen in the form of currency in…

Q: Dollar bills, rare paintings, and emerald necklaces are all

A: All the features of money will not present in other valuable items.

Q: Definition of the initial cash reserve

A: Cash reserves are funds held on hand by a company or a person to meet short-term and emergency…

Q: Debit cards are considered as __________ money

A: According to time, place and different circumstances money has evolved itself through many different…

Q: The money in your personal checking account is counted as: A. Neither M1 nor M2 money…

A: M1 is the measure of money which includes - M1 = Cash + Demand Deposits + Deposits in Checking…

Q: 'Credit' means Increase in an account Decrease in an account Right side of an account Left side of…

A: Accounting is basically a system that is used to record, summarize, and organize financial or…

Q: On a bank's T-account,

A: Banks T account shows the classification of asset and liabilities.

Q: 'Debit' means O Increase in an account Decrease in an account Right side of an account Left side of…

A: Meaning of Accounting: Here, the term accounting refers to those recording of various transactions…

Q: If people use ketchup packets as a medium of exchange, what type of money would they be?

A: When ketchup packets act as medium of exchange then the money would be called as commodity…

Q: Views on electronic money, or e-money, and digital cash

A: Money is a medium of exchange and is accepted as payment of any product or service.

Q: Describe Factors that influence the use of money vs credit cards.

A: Money: Money is a widely accepted instrument used as a measure of value, a medium of exchange, a…

Q: Money

A: Money is the main & most important ‘medium of exchange’ in an economy. Through these medium…

Q: Explain in no more than 5 sentences. Why is there is a need to follow certain financial precautions…

A: Answer - Need to find- Why is there is a need to follow certain financial precautions when writing…

Q: Which type of risk are savings institutions least susceptible to? Interest rate risk Liquidity risk…

A: Since you have asked multiple questions, we will solve first question for you. If you want any…

Q: Why is money considered fungible?

A: The term “fungibility” means the sate of interchangeability. Money is a unit that acts a measure of…

Q: different types of money

A: Money is defined as an economic unit which acts as a general recognized medium of exchange for…

Q: A $25,000 price tag on a new car is an example of money as: Store of value Medium of exchange Unit…

A: Primary function of money: Money has three primary functions, i.e., Medium of exchange, Unit of…

Q: Find the New deposit if the required reserve ratio is 20% and the initial change in the volume of…

A: Required reserve ratio is the percentage of each deposit that the bank is required to hold as…

Q: True or False: If you purchase a gift card electronically through a site such as Plastic Jungle, you…

A: A market is a place where the exchange of goods and services takes place between the buyers and…

Q: Someone’s uncle leaves them $10,000 in his will, but with a requirement that they invest the money…

A: The IRA is a personal sàvings account that provides tax benefits to people who set àside their…

Q: To deposit and withdraw funds from linked bank accounts, which system call will be used? Withdraw…

A: A linked account is one that is linked to another at the same financial institution so that money…

Q: M1 includes savings deposits. a. T b. F

A: Meaning of Money Supply: The term money supply refers to the situation under which the overall…

Q: When you open a savings account, you and your joint account holder will need these four items. Put a…

A: A bank account is an important arrangement made by a bank to let the depositor deposit their money…

Q: Now It's Finally Time to Start Spending My Retirement Nest Egg Not so fast! People work long and…

A: “Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Joey Espinoza has $1,000 in cash, he deposits the total amount in LegionBanc. LegionBanc lends the…

A: Required reserve ratio is the minimum amount of reserves to be maintained by the central bank to…

Q: Money flow

A: Money flow is determined by calculating the daily volume by the average of the high, medium, and…

Q: EXPLAIN THE CONCEPT TRANSFER PAYMENT IN DETAIL

A: Transfer payments are one sided payments and such payments are not part of GDP calculation.

Q: hat equation can determine whether a cryptocurrency is significantly overvalued?

A: Bitcoin is the first implementation of a term known as "cryptocurrency," which was first introduced…

Q: Why is it helpful to track your spending for 2 months? a. You can receive higher interest rates for…

A: As an individual who make expenditure on different goods and services according to his interest,…

Q: How can cryptocurrency's advantage and disadvantages help the economy

A: Cryptocurrencies are digital assets and decentralised systems that enable secure online…

Q: M1

A: The main reason behind the financial crisis of 2008 is due to the burst of the housing bubble. Too…

Q: Example scenarios of five forms of money

A: Money is an object that is accepted in form of payment for any goods or services in a country. It is…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

If you take 100 out of your piggy bank and deposit it in your checking account, how did M1 change? Did M2 change?
Ali transfers 1000 dollars from his checking account to his savings account. This transactionwilla) decrease both M1 and M2.b) not change M1 and decrease M2.c) decrease M1 and not change M2.d) increase both M1 and M2.
Sarafina withdraws $450 from her saving account and places the money in her wallet. This transaction will Select one: O a. not change M1 and decrease M2. Ob. increase M1 and not change M2. OC. increase both M1 and M2. O d. decrease both M1 and M2. Next
John transfers $1000 from his checking account to his saving. This transaction will a. Decrease both m1 and m2 b. Not change m1 and decrease m2 c. Decrease m1 and not change m2 d. increase both m1 and m2
What does m1,m2 m3 include in detail ??
John Antonio transfers $5000 from his checking account to his savings account. How are M1 and M2 affected by this decision? a.M1 increases and M2 decreases b.M1 and M2 remain the same c.M1 decreases and M1 increases d.M1 increases and M2 increases e.M1 decreases and M2 decreases
Suppose you transfer the balance of your savings account at your credit union to your chequing account at your bank. How would this transfer of money affect M2 and M2+? Select one: M2 would increase and M2+ would fall. O b. M2 would inerease and M2+ would stay the same. Oc There would be no change in either M2 or M2+ d. Both M2 and M2+ would fall Clear my choice
5. Joseph transfers $1000 from his money market fund to his checking account. This transaction will: decrease M2 and increase M1. increase M1, but leave M2 unchanged. decrease M1 and increase M2. decrease both M1 and M2.
2. Determine whether each of the following is included in both M1 and M2 or M2 only: a. a Connecticut quarter b. a savings account at a local savings bank c. a share draft account at a credit union d. money market deposit accounts e. American Express travelers' checks
An increase in 1 billion dollars in savings in the economy would result in an increase in M1 only O an increase in M1 and no change in M2 O an increase in M1 and M2 O an increase in M2 only
7. John transfers $150 from his money market fund to his checking account. This transaction will: decrease M2 and increase M1. increase M1, but leave M2 unchanged. decrease M1 and increase M2. decrease both M1 and M2.
If traveler’s checks were $500 higher and saving deposits were $1,000 higher, M1 would be?