The monetary base consists of:
A) reserves and currency.
B) M1 plus M2.
C) only M1.
D) gold reserves plus currency.
E) a country's holdings of foreign and domestic currencies.

Question

Quizplus · Accepted Answer

The monetary base is made up of the reserves held by banks and the physical currency circulating in the economy. It does not include M1 or M2, which are broader measures of the money supply. It also does not include gold reserves or holdings of foreign and domestic currencies.

The Monetary Base Consists Of