Question

How does M2 differ from M1? What are money market mutual funds? Looking for a type-in...

How does M2 differ from M1? What are money market mutual funds?

Looking for a type-in answer

class of finance

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

M-2 and M-1 are both the criteria of money designed by the Central Bank as per the liquidity.

M-2 measure is less liquid than M-1 measure

M-2 includes cash, chequeble deposies, traveller's cheque, certificate of deposites, money market mutual funds, time deposites and savings

M-1 being more liquid only includes cash, chequeable deposit, traveller's cheque

Money market mutual funds are funds that Invest solely in highly cash/cash equivalent securities. These are short term, very liquid Investments and with a very high credit quality. The instruments include certificate of deposit, commercial paper and banker's acceptance.

I hope this helps you

Feel free to ask anything in comments

Also press the like button

Took a lot of efforts in writing detailed answer

Thanks & Regards

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Money market mutual funds are an example of which of the following types of money? M2...
Money market mutual funds are an example of which of the following types of money? M2 M3 M1 M0
Compute M1 and M2 given the following data (3pts): Money market mutual funds $250B Traveler’s checks...
Compute M1 and M2 given the following data (3pts): Money market mutual funds $250B Traveler’s checks $10B Cash on Hand $2525B Dollars held by European Central Bank $250B Cash held by the Federal Reserve $700B Vault Cash at Banks $300B Small time deposits $350B Savings-type accounts $225B Checking deposits $450B Bank Holdings of foreign currency $320B Bank Reserves at the Fed $1600B Corporate shares held by public $1200B Corporate shares held by banks $1700B M2:______________
11. Cash is counted in the money supply as a part of: both M1 and M2....
11. Cash is counted in the money supply as a part of: both M1 and M2. M1 only. M2 only. neither M1 or M2. 12. A bond's price and yield: move in opposite directions. move in the same direction. are usually equal in value. must sum up to 1,000. 13. Barter as a system tends to work only: among large, multinational corporations. in primitive economies with little product variety. in small U.S. towns and villages. when agricultural products are exchanged....
M1 differs from M2 because ________. A) M1 is less liquid than M2 B) M1 includes...
M1 differs from M2 because ________. A) M1 is less liquid than M2 B) M1 includes demand deposits and M2 does not C) M1 includes only the most liquid forms of money and M2 includes all of M1 and some less liquid items D) all of the above E) none of the above
1. If an individual moves money from a checking deposit to a money market mutual fund...
1. If an individual moves money from a checking deposit to a money market mutual fund account a. M1 stays the same and M2 stays the same. b. M1 increases and M2 decreases c. M1 decreases and M2 stays the same d. M1 stays the same and M2 increases 2. If a $1,000 face-value discount bond maturing in one year has an yield of 5%, then its price is?? a. $995 b. $1050 c. $1005 d. $952.4 3. If a...
State the immediate effect of each of the following actions on M1 and M2: Instructions: If...
State the immediate effect of each of the following actions on M1 and M2: Instructions: If there is no change in M1 or M2, enter zero as your response. a. Barry writes his plumber a check for $200. The plumber takes the check to the bank, keeps $50 in cash, and deposits the remainder in his savings account.     M1: by $ .     M2: by $ . b. Maureen deposits the $1,000 from her CD in a money market mutual fund....
Money Market Hedges. How does a money market hedge differ for an account receivable versus that...
Money Market Hedges. How does a money market hedge differ for an account receivable versus that of an account payable? Is it really a meaningful difference?
What is the value of M2? Checkable deposits: $400,000,000 Currency: $340,000,000 Traveler's checks: $4,000,000 Money Market...
What is the value of M2? Checkable deposits: $400,000,000 Currency: $340,000,000 Traveler's checks: $4,000,000 Money Market mutual funds:$50,000000 Small time deposits: $6,000000 Savings deposits: $850,000,000
What is the discount rate? How does it differ from the federal funds rate? Describe how...
What is the discount rate? How does it differ from the federal funds rate? Describe how the Fed affects each of these interest rates.
In economics, money refers to A) income. B) wealth. C) assets used and accepted as payment....
In economics, money refers to A) income. B) wealth. C) assets used and accepted as payment. D) currency. M1 does not include A) Money market mutual funds. B) travelers' checks. C) currency. D) transaction accounts. Which of the following statements about M1 and M2 is not true? A) Transaction accounts are part of M1. B) M2 is more liquid than M1. C) M2 is larger than M1. D) Transaction accounts are part of M2. M2 does not include A) Treasury...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT