The M2 Aggregate

question 8

Multiple Choice

The M2 aggregate

• A) includes M1 plus short-term investment accounts.
• B) includes M1 plus large-denomination time deposits.
• C) equals currency plus checking account deposits at commercial banks.
• D) is the best definition of money purely as a medium of exchange.

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Definitions:

Installation Costs

Expenses associated with setting up or installing equipment, machinery, or infrastructure necessary for the operations or activities of a business.

Depreciation Process

The systematic reduction in the recorded cost of a fixed asset over its useful life, reflecting its decrease in value over time.

Matching Principle

An accounting principle that dictates expenses should be recognized in the same period as the revenues they help to generate.

Market Value

The present rate at which a service or asset is available for purchase or sale in the marketplace.