If Rob deposits $300 in currency into his savings account at Bank of America,
A)M1 decreases.
B)M1 does not change.
C)M2 increases.
D)M2 decreases.
E)M1 and M2 both increase.

Question

Quizplus · Accepted Answer

Rob's deposit of $300 in currency into his savings account at Bank of America increases the amount of currency in circulation, which is a component of M1. Therefore, M1 increases.

If Rob Deposits $300 in Currency into His Savings Account