M1 is a category of the money supply that includes currency in circulation (notes and coins), as well as checkable deposits (including checking accounts) and traveler's checks. It does not include deposits at the Federal Reserve, small CDs, or money market accounts, which are considered in broader measures of the money supply.

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M1 Includes

Question 7

Multiple Choice

M1 includes

A) cash held by banks and by the public plus deposits at the Federal Reserve.
B) currency plus checkable accounts and traveler's checks.
C) currency plus checkable accounts plus traveler's checks plus small CDs and money market accounts.
D) just cash held by the public.

Correct Answer: