Question

a. Which two of the following financial institutions offer checkable deposits included within the M1 money...

a. Which two of the following financial institutions offer checkable deposits included within the M1 money supply?

Thrift institutions

unanswered Insurance

companies unanswered

Commercial banks

Securities firms

Mutual fund companies

b. Which of the following items is (are) not included in either M1 or M2?

Money market mutual fund balances held by individuals

Checkable deposits

Small-denominated (less than $100,000) time deposits

Money market mutual fund balances held by businesses

Currency held by banks

Savings deposits unchecked

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Homework Answers

Answer #1

a. Thrift institutions

Commercial banks.

Explanation :

Thrift institutions and commercial banks are the financial institutions that offer checkable deposits included within the M1 money supply. Thrift institutions are financial institutions in which most of its funds are derived from public's savings. Examples include credit union, savings banks, loan and savings associations etc. Thrift institutions and commercial banks perform various services like business loans making, deposit accepting, investment offering etc which also includes offering checkable deposits included within the M1 money supply.

b. Currency held by banks.

Explanation :

Currency held by banks is not included in either M1 or M2 because money or funds that are being held by these banks and the government are not included in the country's actual monetary circulation.

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