Purchase to a credit card - M1 or M2?

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Purchase to a credit card - M1 or M2?

2007-03-24 17:07:35 · 4 answers · asked by ohok 2 in Social Science ➔ Economics

4 answers

M1; it is a current account.

Credit card purchases are not cash for the consumer, but it IS cash that leaves the bank and enters the money supply via the seller.

At the time of purchase, the seller essentially has a demand deposit with the credit card company and that makes it M1.

2007-03-27 06:53:08 · answer #1 · answered by Anonymous · 0⤊ 0⤋

M1 preferably

2007-03-25 00:09:34 · answer #2 · answered by Anonymous · 0⤊ 0⤋

2007-03-25 00:36:32 · answer #3 · answered by szeplany 2 · 0⤊ 0⤋

Neither until the credit card is paid. That is a trick question.

2007-03-27 08:09:07 · answer #4 · answered by Santa Barbara 7 · 0⤊ 0⤋