Use the Following to Answer Questions

question 4

Multiple Choice

Use the following to answer questions.
Exhibit: Money in the Economy

-(Exhibit: Money in the Economy) In Year 1, if savings deposits had been $200 billion instead of $150 billion, M1 would have been

• A) unaffected.
• B) larger by $50 billion.
• C) smaller by $50 billion.
• D) $100 billion.

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Definitions:

Modern Economies

Modern Economies refer to those systems that exhibit characteristics of mixed economies, combining elements of free market and state intervention to manage economic activities.

Self-Sufficient

Being able to meet one's basic needs without external assistance, characterized by independence in producing goods and services required for survival.

European Monetary Union

The European Monetary Union is a group of European countries that share a common currency, the euro, and a common central bank, the European Central Bank.

Manufacturing Export

Goods produced domestically and sold to customers in foreign countries.