Since the 1980s,"NOW" accounts have been included in
A)M1, but not M2.
B)M2, but not M1.
C)both M1 and M2.
D)the monetary base and M1, but not M2.
E) neither M1 nor M2.

Question

Quizplus · Accepted Answer

NOW (negotiable order of withdrawal) accounts are a type of transaction account that allows the account holder to withdraw funds at any time through checks or electronic transfers. These accounts are included in both M1 and M2 monetary aggregates. M1 includes currency in circulation, demand deposits, traveler's checks, and other checkable deposits, while M2 includes all components of M1 plus savings deposits, small-denomination time deposits, and retail money market mutual fund shares. Therefore, the correct answer is C, which states that NOW accounts are included in both M1 and M2.

Since the 1980s,"NOW" Accounts Have Been Included in