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    Which of the following denotes currency with the public?
    Question

    Which of the following denotes currency with the public?

    A.

    M3

    B.

    M2

    C.

    M4

    D.

    M1

    Correct option is A


    Narrow Money M1 = Currency with the public + Demand Deposits of public in Banks When a third component viz. Post office Savings Deposits is also added to M1, it becomes M2. M2 = M1 + Post Office Savings. Broad Money M3 = Narrow money + Time Deposits of public with banks.

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