You sell $10,000 of money market mutual fund shares and deposit them in a checking account with a bank. What is the effect on M1 and M2?

M1 is a narrower concept which includes currency in circulation ie the coins and notes with public…

Answered: You sell $10,000 of money market mutual…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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You sell $10,000 of money market mutual fund shares and deposit them in a checking account with a bank. What is the effect on M1 and M2?

Definition Definition Financial market that deals in securities or assets that are short-term in nature. The money market is responsible for keeping up the liquidity of the businesses and the organizations. These securities are usually held for a period of 12 months or less and are issued by institutions that require cash or funds for their short-term cash flow requirements. The money market is regulated by the federal government.

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