Consider the following items.

Question

Part 2
A​ $1,000 balance in a transactions deposit at a mutual savings bank.
This item is counted in---.M1, M2 , M1 and M2--.
.

Bot · Answer

This item is counted in both M1 and M2.

111 · Answer

b. A​ $100,000 certificate of deposit issued by a New York bank. This item is counted in---.

Bot · Answer

This item is counted in M2.

111 · Answer

Wrong answer. ​Small-denomination time deposits are counted in M2. But to​ qualify, the time deposits have to be less than​ $100,000. So in this​ case, the certificate of deposit is not included in either M1 or M2.

Bot · Answer

You are correct, I apologize for the incorrect response. The ​$100,000 certificate of deposit would not be included in either M1 or M2. Thank you for clarifying.

111 · Answer

c. A​ $10,000 time deposit an elderly widow holds at her credit union. This item is counted in---.

Bot · Answer

This item is counted in M2. Time deposits held at credit unions, regardless of the amount, are considered part of M2.

111 · Answer

d. A​ $50 traveler's check. This item is counted in---.

Bot · Answer

This item is counted in M1. Traveler's checks are considered as part of the money supply because they can be used directly as a form of payment. Therefore, it is included in M1, which represents the most liquid forms of money.

111 · Answer

wrong answer. A​ $50 traveler's check is counted as part of​ M1, and hence is part of​ M2, since M1 is counted in M2.

Consider the following items.

This item is counted in both M1 and M2.

b. A $100,000 certificate of deposit issued by a New York bank.

This item is counted in M2.

Wrong answer. Small-denomination time deposits are counted in M2. But to qualify, the time deposits have to be less than $100,000. So in this case, the certificate of deposit is not included in either M1 or M2.

You are correct, I apologize for the incorrect response. The $100,000 certificate of deposit would not be included in either M1 or M2. Thank you for clarifying.

c. A $10,000 time deposit an elderly widow holds at her credit union.

This item is counted in M2. Time deposits held at credit unions, regardless of the amount, are considered part of M2.

d. A $50 traveler's check.

This item is counted in M1. Traveler's checks are considered as part of the money supply because they can be used directly as a form of payment. Therefore, it is included in M1, which represents the most liquid forms of money.

wrong answer. A $50 traveler's check is counted as part of M1, and hence is part of M2, since M1 is counted in M2.

Consider the following items.

This item is counted in both M1 and M2.

b. A​ $100,000 certificate of deposit issued by a New York bank.

This item is counted in M2.

Wrong answer. ​Small-denomination time deposits are counted in M2. But to​ qualify, the time deposits have to be less than​ $100,000. So in this​ case, the certificate of deposit is not included in either M1 or M2.

You are correct, I apologize for the incorrect response. The ​$100,000 certificate of deposit would not be included in either M1 or M2. Thank you for clarifying.

c. A​ $10,000 time deposit an elderly widow holds at her credit union.

This item is counted in M2. Time deposits held at credit unions, regardless of the amount, are considered part of M2.

d. A​ $50 traveler's check.

This item is counted in M1. Traveler's checks are considered as part of the money supply because they can be used directly as a form of payment. Therefore, it is included in M1, which represents the most liquid forms of money.

wrong answer. A​ $50 traveler's check is counted as part of​ M1, and hence is part of​ M2, since M1 is counted in M2.

b. A $100,000 certificate of deposit issued by a New York bank.

Wrong answer. Small-denomination time deposits are counted in M2. But to qualify, the time deposits have to be less than $100,000. So in this case, the certificate of deposit is not included in either M1 or M2.

You are correct, I apologize for the incorrect response. The $100,000 certificate of deposit would not be included in either M1 or M2. Thank you for clarifying.

c. A $10,000 time deposit an elderly widow holds at her credit union.

d. A $50 traveler's check.

wrong answer. A $50 traveler's check is counted as part of M1, and hence is part of M2, since M1 is counted in M2.