M2 is defined as M1 plus savings accounts, money-market mutual funds (held by individuals), and small time deposits (under $100,000). Therefore, choice D is the correct answer. A and B are incorrect because they do not include small time deposits, and C includes repurchase agreements issued by banks, which are not typically considered part of M2.

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M2 Consists of

Question 44

Multiple Choice

M2 consists of

A) amounts in savings accounts, money-market mutual funds (held by individuals) , and small time deposits (under $100,000) .
B) amounts in savings accounts, and money-market mutual funds (held by individuals) .
C) M1 plus amounts in savings accounts, money-market mutual funds (held by individuals) , small time deposits (under $100,000) , and repurchase agreements issued by banks.
D) M1 plus amounts in savings accounts, money-market mutual funds (held by individuals) , and small time deposits (under $100,000) .

Correct Answer: