All M1 Assets Are Included in M2

question 98

Essay

All M1 assets are included in M2.We will call those assets that are part of M2 but not part of M1,"M2 assets".You have just received $5,000 that you must hold as either an M1 asset or an M2 asset.What are the costs and benefits of holding the $5,000 as an M1 asset rather than as an M2 asset? Explain.

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Definitions:

Burritos

A Mexican dish consisting of a flour tortilla wrapped or folded around a filling typically including beans, cheese, and meats.

Income

The money received by a person or organization, typically in exchange for goods, services, or investments.

Total Utility

The complete satisfaction or pleasure a consumer derives from consuming a certain quantity of a good or service.

Marginal Utility

The extra pleasure a customer receives from using an additional unit of a product or service.