D Question 19 4 pts If no other changes are assumed if the c

D Question 19 4 pts If no other changes are assumed, if the currency in circulation increases by O M2 money supply will increase. O M1 money supply will not change. O M1 money supply will decline. O M2 money supply will decline. Next 4 Previous Quiz saved at 9:57pm Submit Quiz

Solution

19. M1 money supply includes coins and currency in circulation, checkable deposit.

M1 = currency in circulation + checkable deposit

If currency in circulation increases by $100 billion while checkable deposit decreases by $100 billion, then the change in M1 is 0.

Answer- option B

20. M1 = currency in circulation + checkable deposit = $(60+80) = $140

Answer- option A

21. Credit card balances are not part of the money supply. Therefore, it is not a component of M1 or M2.

Answer- option D