1. Loans and deposits within a bank are:
are not found on a bank’s balance sheet.
liabilities and assets, respectively, on a bank’s balance sheet.
both liabilities.
assets and liabilities, respectively, on a bank’s balance sheet.
both assets.
2. If Anna were to convert some of her checkable deposits into a (small denomination) certificate of deposit, which of the following changes would take place?
M1 would decrease; M2 would decrease.
There would be no changes to M1 or M2.
M1 would decrease and then increase; M2 would increase and then decrease.
M1 would decrease; there would be no change in M2.
M1 would increase; M2 would increase.