Ava Buys a $2,000 Computer Using a Paper Check

question 54

Multiple Choice

Ava buys a $2,000 computer using a paper check. At which step does $2,000 get recorded in M1?

• A) When Ava hands the $2,000 check to the computer merchant.
• B) Once the $2,000 is credited to the merchant bank's reserve account and is debited from Ava's bank account.
• C) Once the Federal Reserve sends the paper check (or an electronic image) to Ava's bank.
• D) The check is never M1. The $2,000 is M1 both in Ava's bank account and, later, in the merchant's account. It is the deposit balance that is counted.

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Definitions:

Prepackaged Meal

A meal that has been prepared, packaged, and sold in a ready-to-eat form.

Discovering Consumer Needs

The process of researching and understanding the requirements, desires, or problems of consumers to develop products or services that meet these needs.

New Products

Innovations or items that have been recently introduced to the market, offering fresh options to consumers.

Sales and Manufacturing

The process that involves both the creation of products and their sale to customers.