Final answer:
Tricia's list includes both assets (a bank account) and liabilities (a card and car loan). A balance sheet lists a bank's assets and liabilities, and the difference between them is the bank's net worth or bank capital. Moreover, line of credit, traveler's checks, quarters, checking account balance, and money market account funds are categorized differently in terms of M1 and M2 money supply. So, all options are correct.
Step-by-step explanation:
Understanding Assets and Liabilities
When Tricia listed her 'assets,' such as a card, bill, car loan, and bank account, there seems to be a confusion between assets and liabilities.
It's important to clarify that an asset is something of value you own, while a liability is a debt or obligation that you owe.
In Tricia's list, cards (likely credit cards) and car loans represent liabilities, not assets, since they are debts that must be repaid. Her bank account, assuming it has a positive balance, would be considered an asset.
In banking, a balance sheet is a tool that lists a bank's assets and liabilities, which include reserves, loans, bonds (assets), and deposits (liabilities).
The difference between a bank's total assets and total liabilities is known as its net worth or bank capital.
Learning to differentiate between what constitutes an asset and a liability is essential for properly managing personal finances and understanding financial statements.
Additionally, when listing items in terms of M1 and M2 money supply categories:
a. A line of credit is neither M1 nor M2 as it is potential debt.
b. Traveler's checks, if unused, are part of M1.
c. Quarters in your pocket are part of M1 as they are physical currency.
d. Funds in a checking account are part of M1.
e. Money in a money market account is part of M2, but not M1.
So, all options are correct.