Econ Homework Help Please!?

Question

Jackie has the following list of assets:

$145 in coins and currency

$1,200 in a savings account

$500 in a checking account

40 shares of General Electric stock, which currently sells for $20 per share

$1,000 in a money-market mutual fund

$2,000 in a U.S. government bond that matures in five years

1.) What is the dollar value of Jackie's assets that are considered part of M1?

2.)What is the dollar value of Jackie's assets that are considered part of M2?

3.) What is the current dollar value of Jackie's assets that can be considered a store of value?

Answer 1

1. M1 is checkable demand deposits only, so that includes $145 + $500 = $645

2. M2 counts M1 + savings deposits + money market funds, so that's $645 + $1,200 + $1000 = $2,845

3. Store of value would be everything since everything can be converted to real money balances in the long run = $5,645

Answer 2

Amount...Type

$145...........M1

$1'200........M2

$500...........M1

$800...........M2

$1'000........M3

$2'000........M3

1: M1=$645

2: M2=$2'645

3 Store of value = $5'645 , just sum them all.

Answer 3

M1-$645

M2-$2845

store of value-$5645