Coins in circulation are $21000, demand deposits (checkable deposits) is $250000, Traveler’s checks is $150000, Money Market Funds (individual) is $1050000, Savings deposit in Banks is $950000, Time deposit is $65000 (individually less than $50,000). Calculate M2.
Coins in circulation are $21000, demand deposits (checkable deposits) is $250000, Traveler’s checks is $150000, Money Market Funds (individual) is $1050000, Savings deposit in Banks is $950000, Time deposit is $65000 (individually less than $50,000). Calculate M2.
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Assume that the following asset values (in millions of dollars) exist in Ironmania:
| Category | Value |
| Federal Reserve Notes in circulation | $700 |
| Money market mutual funds (MMMFs) held by individuals | 400 |
| Corporate bonds | 300 |
| Iron ore deposits | 50 |
| Currency in commercial banks | 100 |
| Savings deposits, including money market deposit accounts (MMDAs) | 140 |
| Checkable deposits | 1,500 |
| Small-denominated (less than $100,000) time deposits | 100 |
| Coins in circulation | 40 |
a. What is M1 in Ironmania? $ million
b. What is M2 in Ironmania? $ million
INTRO - MACROECONOMICS - Money & Banking - & The Money Market and Monetary Policy
Answer the questions below from the data in the table (all figures are in billions of dollars).
| Total currency issued by the Bank of Canada | $17 |
| Total personal savings deposits | 186 |
| Total demand deposits | 19 |
| Deposits of government at the Bank of Canada | 3 |
| Currency held by commercial banks | 3 |
| Government bonds owned by the public | 96 |
| Nonpersonal term deposits (certificates of deposit) | 41 |
a. Total currency in circulation is $ _____ billion.
b. How much larger is M1 than the total currency in circulation?
M1 is larger than the total currency by $ _____ billion.
c. How much larger is M2 than M1?
M2 is larger than M1 by $ _____ billion.
Please provide an explanation as you solve this question.
d. How much larger is M3 than M2?
M3 is larger than M2 by $ _____billion.
