Verified Document

Supply Of Money Explain Measures Money Supply Essay

¶ … Supply of Money explain measures money supply explain definitions important.

Money

Money is defined as a medium facilitating the exchange of goods and services between trading partners Mishkin & Frederic S., 1998.

Throughout history, exchange of goods and services has taken different forms with the earliest form being barter system. Following the inadequacies of the barter system - lack of coincidence of want and convenience in trading -- generally acceptable commodities were adopted for use in trading Froyen & Richard T., 1998()

Money supply

Money supply is used to refer to total stock of assets generally accepted as the exchange medium in an economy at a particular time Froyen & Richard T., 1998.

According to Mishkin F (1999)

, economist carry on the debate what items should...

Definition of money supply is pegged on the various considerations, the issue being examined and country or economic status Mishkin F, 1999.
Degree of liquidity and ease of conversion into asset determine the money supply. Despite the lack of a universal definition of money supply, there are standard measures of money supply.

Measurements of money supply

According to IMF money supply is a combination of deposit liabilities in a banking system and central banks currency liabilities held by firms, individual households, nonprofit institutions and the public sector as a whole IMF, 1997.

Recognized standard representations of money supply are M0, M1 and M2.

M0 is the currency in public hands of the, bank's reserves and statutory reserves deposits held for banks at the central bank. This is referred to…

Sources used in this document:
References

Froyen, & Richard T. (1998). Macroeconomics: Theories and Policies. 6th ed. Upper Saddle River: Prentice Hall.

IMF. (1997). Manual on Monetary and Financial Statistics. U.S.: IMF.

Mishkin, & Frederic S. (1998). The Economics of Money, Banking and Financial Markets. 5th ed.: . Reading, PA: Addison-Wesley.

Mishkin F. (1999). Money, Banking and Financial Markets, 3rd edition.: Harper Collins Publishers.
Cite this Document:
Copy Bibliography Citation

Related Documents

Supply of Goods and Services
Words: 2689 Length: 9 Document Type: Research Paper

Supply Chain Strategy When it comes to companies sharing business relationships, and occasionally shareholdings, as well, a Keiretsu network is often the best way to integrate and manage that group of companies (Jacoby, 2009). In that way, the relationship between the businesses becomes a partnership instead of only that of buyer-seller (Jacoby, 2009). There are many long-term benefits of this type of network, and these benefits could be carried over to

Money & Interest Rates if
Words: 1330 Length: 4 Document Type: Essay

There are two other things to consider. The first is that Fed policy can be assumed to be built into the markets. Prices in liquid markets are based on the best possible public information. Therefore, if I know about the pending change in the interest rates, that is public knowledge and will already be priced into the market rates. Any speculation I may have about interest rate changes is

Supply Chain Management Hypothesis Defined Concepts of
Words: 24788 Length: 80 Document Type: Thesis

Supply Chain Management Hypothesis defined Concepts of SCM and the evolution to its present day form Critical factors that affect SCM Trust Information sharing and Knowledge management Culture and Belief -- impact on SCM Global environment and Supply Chain management "Social" and "soft" parameter required for SCM Uncertainties This chapter aims to give an outline and scope of the study that will be undertaken in this work. The study lays out the issues faced by manufacturing organizations when it comes

Supply Chain Planning Under Uncertainty:
Words: 12190 Length: 44 Document Type: Research Proposal

Results from the study by Petersen, Ragatz and Monczka show that effective collaborative planning depends on information quality, and the trust level firms share. The authors purport: "Collaborative planning activities between supply chain partners are expected to lead to better performing supply chains" (Petersen, Ragatz & Monczka, Introduction section ¶ 1). In addition, numerous other researchers have also explored the perception relating to supplier alliances, that enhanced collaborative planning

Money Banking and Financial Markets
Words: 2353 Length: 7 Document Type: Article Review

economic crisis in Europe and the increasing costs for European countries to borrow money and bail out other Euro countries in financial distress. The EU nations that use the Euro have experienced a crisis among certain countries with high debt requiring bailouts for Greece and Ireland and the likelihood that Portugal and Spain may also need a bailout. Postponing the restructuring of high interest debts has led to further

Microeconomics Supply Has an Undeniable Impact Upon
Words: 1555 Length: 5 Document Type: Essay

Microeconomics Supply has an undeniable impact upon price. When supply goes down, price goes up. In this instance, a rapid decrease in supply has led to an increase in the price of lettuce. Unlike producers of other goods and services, farmers cannot always fine-tune their supply according to market demand, because of the impact of the weather upon their ability to produce. Farmers had already planted less lettuce, presumably based upon

Sign Up for Unlimited Study Help

Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.

Get Started Now