If We Look at the Components of M2, We Find

question 129

Multiple Choice

If we look at the components of M2, we find that

• A)savings deposits are the largest component.
• B)money market funds are the largest component.
• C)currency is the largest component.
• D)loans are the largest component.
• E)banks' reserves are the largest component.

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Definitions:

Loan Interest

The amount charged by a lender to a borrower for the use of borrowed money, calculated as a percentage of the principal.

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Sales transactions where the payment is deferred to a future date, allowing customers to purchase goods or services on credit.

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Money owed to a business by its customers for goods or services delivered but not yet paid for.