Table 18.1 : Consider the information above for a small economy. Assume there are no traveler's checks.
-Refer to Table 18.1. M1 in this simple economy equals
A) $500.
B) $550.
C) $1,050.
D) $4,550.

Question

Table 18.1 :  Consider the information above for a small economy. Assume there are no traveler's checks.
-Refer to Table 18.1. M1 in this simple economy equals
A) $500. 
B) $550. 
C) $1,050. 
D) $4,550.

Quizplus · Accepted Answer

M1 in a simple economy includes the sum of currency in circulation and demand deposits. If the table shows $500 in currency and $550 in demand deposits, then M1 = $500 + $550 = $1,050.

Table 181 : Consider the Information Above for a Small