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M2 includes M1 and
- a)Currency and coins
- b)Post Office savings deposits
- c)Term deposits in RBI
- d)Term deposits
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
M2 includes M1 anda)Currency and coinsb)Post Office savings depositsc)...
M2 is a calculation of the money supply that includes all elements of M1 as well as "near money." M1 includes cash and checking deposits, while near money refers to savings deposits, money market securities, mutual funds and other time deposits.
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M2 includes M1 anda)Currency and coinsb)Post Office savings depositsc)...
M2 Money Supply
M2 is a measure of the money supply that includes all elements of M1 (cash and checking deposits) as well as "near money." Near money refers to savings deposits, money market securities, and other time deposits that can be quickly converted into cash or checking deposits.
Components of M2
The components of M2 money supply are:
Currency and coins: This includes all physical currency, such as coins, notes, and bills.
Post Office savings deposits: This refers to savings accounts held at post offices.
Term deposits: These are deposits that cannot be withdrawn for a specified period of time. Examples include fixed deposits or certificates of deposit (CDs).
Term deposits in RBI: These are deposits held with the Reserve Bank of India (RBI) that cannot be withdrawn for a specified period of time.
Savings deposits: These are interest-bearing deposits held in savings accounts at banks and credit unions.
Money market securities: These are short-term debt securities such as Treasury bills, commercial paper, and certificates of deposit.
Conclusion
In conclusion, M2 money supply includes all of M1 (cash and checking deposits) as well as near money, such as savings deposits, money market securities, and other time deposits that can be quickly converted into cash or checking deposits. Post office savings deposits are one of the components of M2 money supply.
M2 is a measure of the money supply that includes all elements of M1 (cash and checking deposits) as well as "near money." Near money refers to savings deposits, money market securities, and other time deposits that can be quickly converted into cash or checking deposits.
Components of M2
The components of M2 money supply are:
Currency and coins: This includes all physical currency, such as coins, notes, and bills.
Post Office savings deposits: This refers to savings accounts held at post offices.
Term deposits: These are deposits that cannot be withdrawn for a specified period of time. Examples include fixed deposits or certificates of deposit (CDs).
Term deposits in RBI: These are deposits held with the Reserve Bank of India (RBI) that cannot be withdrawn for a specified period of time.
Savings deposits: These are interest-bearing deposits held in savings accounts at banks and credit unions.
Money market securities: These are short-term debt securities such as Treasury bills, commercial paper, and certificates of deposit.
Conclusion
In conclusion, M2 money supply includes all of M1 (cash and checking deposits) as well as near money, such as savings deposits, money market securities, and other time deposits that can be quickly converted into cash or checking deposits. Post office savings deposits are one of the components of M2 money supply.
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M2 includes M1 anda)Currency and coinsb)Post Office savings depositsc)Term deposits in RBId)Term depositsCorrect answer is option 'B'. Can you explain this answer?
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