If You Liquidate $3,000 of Your Mutual Fund and Transfer

question 201

Multiple Choice

If you liquidate $3,000 of your mutual fund and transfer the funds to your checking account,then initially,M1 will ________ and M2 will ________.

• A)not change;decrease
• B)increase;decrease
• C)increase;not change
• D)not change;not change

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Definitions:

Seasonal Variation

Refers to periodic fluctuations in data or variables that occur at or depend on specific times of the year.

Moving Average Method

A statistical technique used to analyze time series data by calculating averages of different subsets of the complete dataset.

9-year Moving Averages

A method of smoothing data by calculating the average of different subsets of the total data period of nine years each.

Seasonal Variation

Regular fluctuations in a time series variable within a year, often related to the seasons.