The Components of M2 That Are Not Also in M1

question 57

Multiple Choice

The components of M2 that are not also in M1:

• A)sum to an amount that is smaller than the sum of the components of M1.
• B)pay lower rates of interest than do the components of M1.
• C)are not usable for making payments.
• D)are usable for making payments, but at a greater cost or inconvenience than currency or checks.M2 is a broader measure of money than M1, thus it contains assets that are less liquid than M1.

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Definitions:

Overapplied

A situation in cost accounting where the allocated manufacturing overhead costs exceed the actual overhead expenses incurred.

Underapplied

A situation where the allocated or applied costs are less than the actual costs incurred.

Fixed Overhead Budget Variance

The difference between the actual fixed overhead costs incurred and the budgeted or expected costs.

Unfavorable

A term used in variance analysis to describe a situation where actual results are worse than expected results, leading to a negative impact on financial performance.