M1 Differs from M2 in That

question 107

Multiple Choice

M1 differs from M2 in that:

• A)M1 includes currency and balances held in checking accounts, which are not included in M2.
• B)M2 includes savings deposits, small-denomination time deposits, and money market mutual funds that are not included in M1.
• C)M1 is a broader measure of the money supply than M2.
• D)the assets in M2 are more liquid than the assets in M1.

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Definitions:

Merchandising Business

A merchandising business buys goods in their finished form for the purpose of resale without further processing, making profit through buying and selling activities.

Statement Of Stockholders' Equity

A financial document that shows the changes in the value of a company's equity over a reporting period, including shares issued, dividends, and earnings.

Income Statement

A financial statement that shows a company's revenues, expenses, and profits or losses over a specific period, providing insights into its operational efficiency.

Retail Business

A business type that sells goods or services directly to end consumers.