The definition of M1 includes:
A) cash and checking account balances.
B) hard money and savings account balances.
C) cash and savings account balances.
D) cash, checking accounts, savings accounts, and other financial instruments where money is locked away for a specified period of time.

Question

Quizplus · Accepted Answer

M1 includes the most liquid forms of money, which are cash and checking account balances. Hard money (physical coins and bills) is included in this category, but savings account balances are not. Other financial instruments with longer lock-in periods would fall into broader measures of the money supply, such as M2 or M3.

The Definition of M1 Includes