A basic argument for using the M1 concept of money is that:
A)it includes all of the important financial assets that have any degree of liquidity.
B)the government collects data for the components of M1, but does not do so for M2 and M2+.
C)its components are superior to other financial assets as a store of value.
D)its components are directly and immediately spendable.

Question

Quizplus · Accepted Answer

The basic argument for using the M1 concept of money is that its components are directly and immediately spendable. This means that they can be used for transactions without delay or difficulty, making them more convenient for everyday usage. While the other options may be true to some extent, the direct spendability of M1 components is the primary reason why it is considered a useful concept for measuring the money supply.

A Basic Argument for Using the M1 Concept of Money