Which of the following statements is true?
A) A savings deposit is not counted in the most basic,or narrow,definition of the money supply.
B) M1 is sometimes referred to as transactions money.
C) Money reduces the transaction costs of making exchanges.
D) b and c
E) a,b,and c

Question

Quizplus · Accepted Answer

- Statement A is true as savings deposits are not a part of the most basic definition of money supply (M1). 
- Statement B is also true as M1 refers to the money that can be used for making transactions, such as currency, demand deposits, traveler's checks, etc. 
- Statement C is true as money acts as a medium of exchange and reduces the transaction costs involved in barter exchanges. 
Therefore, all three statements are true and the best choice is E.

Which of the Following Statements Is True