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Economics
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19 Oct 2020

Coins in circulation are $7000, demand deposits (checkable deposits) is $250000, Traveler’s checks is $150000, Savings deposit in Banks is $950000. Calculate M1.

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Darryn D'Souza
Darryn D'SouzaLv10
19 Oct 2020

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Related questions

In the United States, the money supply (M1) is comprised of:
a. coins, paper currency, checkable deposits, and mutual funds.
b. coins, currency, checkable deposits, and Series E bonds.
c. coins, paper currency, checkable deposits, and traveler's checks.
d. paper currency, coins, checkable deposits, and savings deposits.
 

Assume that the following asset values (in millions of dollars) exist in Ironmania:

Category Value
Federal Reserve Notes in circulation $700
Money market mutual funds (MMMFs) held by individuals 400
Corporate bonds 300
Iron ore deposits 50
Currency in commercial banks 100
Savings deposits, including money market deposit accounts (MMDAs) 140
Checkable deposits 1,500
Small-denominated (less than $100,000) time deposits 100
Coins in circulation 40

a. What is M1 in Ironmania? $ million

b. What is M2 in Ironmania? $ million

The M1 money supply is composed of:

a. All coins and paper money held by the general public and the banks.

b. Checkable deposits and currency in circulation.

c. Bank deposits of households and business firms.

d. Bank deposits and mutual funds.

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