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Bob read a newspaper story that indicated a dramatic increase in money market accounts

Bob read a newspaper story that indicated a dramatic increase in money market accounts and certificates of deposit during the last three months. the story reported that all other major components of the u.s. money supply remained unchanged. based on this information, bob can conclude that for the past quarter:
a. both the m-1 and m-2 money supplies were stable.
b. the m-1 money supply has increased, but the m-2 money supply was stable.
c.the m-2 money supply has increased, but the m-1 money supply was stable.
d. both the m-1 and the m-2 money supplies have increased.
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queenkimm26
queenkimm26
4,4(53 marks)

C.The M-2 money supply has increased, but the M-1 money supply was stable.

Explanation:

M1 includes currency in circulation, checkable demand deposit and travellers check.

M2 includes all components of M1 and near money. Near money includes certificate of deposit, savings deposit, mutual funds and money market funds.

I hope my answer helps you

kaleyahkay7474
kaleyahkay7474
5,0(45 marks)

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