Economics of Money, Banking and Financial Markets, The, Business School Edition (5th Edition) (What's New in Economics)
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Chapter 3, Problem 13Q
To determine

Which monetary aggregate of money supply is most liquid assets.

Concept Introduction:

Money supply refers to the official stock of money supplied in a country at a particular point of time. There are some measures of money supply, these are:

M1 . Currency in circulation + Demand deposits

M2 . M1 . Short term time deposits in the banks & 24-hour money market funds

M3 . M2 . Long-term time deposits & money market funds with more than 24-hour maturity.

M4 . M3 . other deposits.

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