M1 includes the most liquid forms of money, such as cash and checking account balances, as well as travelers' checks which are widely accepted as a form of payment. Saving account balances are not considered as part of M1 since they are less liquid and cannot be easily traded as a medium of exchange.

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M1 Includes

Question 50

Multiple Choice

M1 includes:

A) cash and travelers' checks.
B) cash, checking account balances, and travelers' checks.
C) cash, travelers checks', and bank deposits
D) cash, checking account balances, and saving account balances.

Correct Answer: