Question: Assuming no interest is paid on checking accounts what would
Assuming no interest is paid on checking accounts, what would you expect to see happen to the relative growth rates of M1 and M2 if interest rates rose significantly?
Relevant QuestionsCould the dollar still function as the unit of account in a totally cashless society?Under what circumstances might money in the form of currency be the best option as a store of value?The Chicago Mercantile Exchange has announced the introduction of a financial instrument that is based on rainfall in the state of Illinois. The standard agreement states that for each inch of rain over and above the ...What risks might financial institutions face by funding long-run loans such as mortgages to borrowers (often at fixed interest rates) with short-term deposits from savers? Use Core Principle 3 from Chapter to suggest some ways in which the problems associated with the shadow banking sector during the 2007-2009 financial crisis might be mitigated in the future.
Post your question