Table 9-2 -Refer to Table 9-2. in Year 2, If Savings Deposits

question 213

Multiple Choice

Table 9-2

-Refer to Table 9-2. In Year 2, if savings deposits had been $250 billion instead of $200 billion, M2 would have been

• A) $575 billion.
• B) larger by $50 billion.
• C) smaller by $50 billion.
• D) unaffected.

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Definitions:

Liquidity Ratios

Financial ratios that measure a company's ability to meet its short-term obligations, such as current ratio and quick ratio.

Activity Ratios

Financial metrics used to measure a company's ability to convert different accounts within its balance sheets into cash or sales.

Activity Ratios

Metrics that assess the efficiency with which a company utilizes its assets to generate revenue or sales.

Cash Flow

The total amount of money being transferred into and out of a business, specifically measuring its liquidity and financial health over a period.