All chequable deposits are included in
A)M1 only.
B)M2 only.
C)M1 and M2.
D)savings balances only.

Question

Quizplus · Accepted Answer

Chequable deposits are included in both M1 and M2. M1 includes cash held by the public and chequable deposits, while M2 includes M1 plus savings deposits, time deposits less than $100,000, and money market mutual funds. Therefore, choice C is the best answer. Savings balances only (choice D) is not correct as chequable deposits are not limited to savings accounts.

All Chequable Deposits Are Included in