The M2 aggregate
A) includes M1 plus short-term investment accounts.
B) includes M1 plus large-denomination time deposits.
C) equals currency plus checking account deposits at commercial banks.
D) is the best definition of money purely as a medium of exchange.

Question

Quizplus · Accepted Answer

M2 includes M1 (currency and checking account deposits) as well as short-term investment accounts, such as savings accounts and money market mutual funds. Large-denomination time deposits are actually included in M3, not M2.

The M2 Aggregate