Problem

Table (2) Money Supply Developments (M2) (KD million) Change End of Period 2018/19 2019/20 Value (%) 38,947.3 38,022.6 -924.7 -2.4 Money Supply (M2) Money (M1) of which: 10,492.3 11,476.5 984.2 9.4 Sight Deposits 8,688.9 9,351.0 662.1 7.6 Quasi Money 28,455.0 26,546.1 -1.908.9 -6.7 25,698.3 24,160.8 -1,537.5 -6.0 KD Deposits (other than sight deposits) FC Deposits Source: Central Bank of Kuwait 2,756.7 2,385.2 -371.5 -13.5 Based on the Table above, answer the following questions: a) Calculate the value of the currency in circulation in both periods. Show steps. b) Calculate the value and percentage change in the currency in circulation. c) According to the Central Bank of Kuwait, which aggregate measure is better in assessing money supply? d) According to this table, what was the main driver of the negative change in money supply in 2019/2020? Table (2) Money Supply Developments (M2) (KD million) Change End of Period 2018/19 2019/20 Value (%) 38,947.3 38,022.6 -924.7 -2.4 Money Supply (M2) Money (M1) of which: 10,492.3 11,476.5 984.2 9.4 Sight Deposits 8,688.9 9,351.0 662.1 7.6 Quasi Money 28,455.0 26,546.1 -1.908.9 -6.7 25,698.3 24,160.8 -1,537.5 -6.0 KD Deposits (other than sight deposits) FC Deposits Source: Central Bank of Kuwait 2,756.7 2,385.2 -371.5 -13.5 Based on the Table above, answer the following questions: a) Calculate the value of the currency in circulation in both periods. Show steps. b) Calculate the value and percentage change in the currency in circulation. c) According to the Central Bank of Kuwait, which aggregate measure is better in assessing money supply? d) According to this table, what was the main driver of the negative change in money supply in 2019/2020