10.2 Money Supply Quiz

What is the basic supply of money in circulation known as?

• M2

• M1

• M3

• M0

Which of the following is NOT a component of the basic money supply known as M1?

• Currency

• Checking accounts

• Bonds

• Traveler’s checks

What does currency consist of according to the U.S. Treasury System?

• Gold bars and silver coins

• Coins issued by the U.S. Treasury and paper money issued by the Federal Reserve System

• Cryptocurrencies and digital tokens

• Bonds and stocks

What are checking accounts also known as?

• Savings deposits

• Demand deposits

• Time deposits

• Loan accounts

What can owners of checking accounts do with the funds in their accounts?

• Invest in stocks directly from the accounts

• Withdraw the funds in currency or write a check to transfer the funds to a third party

• Exchange the funds for traveler's checks only

• Transfer the funds to cryptocurrency wallets

What is the paper money issued by the Federal Reserve System called?

• Treasury notes

• Federal Reserve notes

• Silver certificates

• National bank notes

Who issues traveler's checks?

• The U.S. Treasury

• A bank

• The Federal Reserve

• The Stock Exchange

What does M2 include that M1 does not?

• Savings deposits, small-denomination time deposits, and money market mutual fund accounts

• Credit card balances and student loans

• Stock market investments and bonds

• Real estate properties and gold reserves

What is a characteristic of a savings account?

• It cannot be used to earn interest

• It is primarily used for stock market investments

• It is an interest-earning account

• It always has check-writing privileges

Is a credit card considered money?

• Yes, it is considered money.

• No, it is not considered money.

• Yes, but only for online transactions.

• No, but it can be used to create money.