What is the effect on the money supply when you transfer $150,000 from your checking account to your savings account?

What is the effect on the money supply when you transfer $150,000 from your checking account to your savings account? 

 Decrease M1; increase M2

 Decrease M2; increase M3

 No effect on M1; increase M2

 No effect on M2; increase M3

 Decrease M2; no effect on M3

I think the answer is that there will be no effect on m2 and a decrease in m1 because m2 includes checking account and savings account, which means no change. m1 only includes checking account in this case.

"Order a similar paper and get 100% plagiarism free, professional written paper now!"

Order Now