Why Are Notice Deposits Not Included in the M1 Definition

question 19

Multiple Choice

Why are notice deposits not included in the M1 definition of money?

• A)Because the real value of notice deposits is zero.
• B)Because the value of notice deposits is much less stable than that of demand deposits and currency.
• C)Because they do not have direct or immediate access to goods and services.
• D)Because they are not recognized in law as legal tender.
• E)Because in terms of volume they are much less than demand deposits.

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Definitions:

Fixed Price

A price that does not change over time or in response to market conditions, often set by a seller or agreement.

Budget Line

An illustrated chart depicting all the different pairings of two items that are purchasable within a certain budget and cost framework.

Price of Food

The monetary value assigned to food products, influenced by factors such as production costs, supply and demand.

Rotation

The act of turning around a center or an axis, often used metaphorically to describe a systematical shift in processes or roles.