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Practice Questions
Test your understanding with targeted questions related to the topic.
Question 1
Easy
What is M0 in the context of the money supply?
💡 Hint: Think about cash and coins!
Question 2
Easy
List two components of M1.
💡 Hint: Consider what money you can easily use.
Practice 4 more questions and get performance evaluation
Interactive Quizzes
Engage in quick quizzes to reinforce what you've learned and check your comprehension.
Question 1
What is included in M2?
- Only cash
- M1 and time deposits
- Just demand deposits
💡 Hint: Think of it as a combination of cash and savings.
Question 2
Is the following statement true or false? 'An increase in the reserve ratio decreases the money supply.'
- True
- False
💡 Hint: Higher reserve ratio - what does it mean for lending?
Solve and get performance evaluation
Challenge Problems
Push your limits with challenges.
Question 1
Discuss how changes in consumer savings behavior can impact the money supply.
💡 Hint: Think about how much money flows in versus out.
Question 2
Evaluate the role of the central bank in controlling inflation and how it relates to the money supply.
💡 Hint: How does adjusting rates affect spending and saving?
Challenge and get performance evaluation