Which of the following is included in the M1 measure of money supply?
A) Currency with Public
B) Time Deposit with Post Office
C) Demand Deposits with Commercial Banks/RBI of Public Financial Institutions

Correct option is B

The correct answer is (b) Both A and C
The M1 measure of money supply typically includes:
1. Currency with Public: This refers to all currency (notes and coins) that is held by the public outside of the vaults of the central bank and commercial banks. It does not include cash held by the banks themselves.
2. Demand Deposits with Commercial Banks/RBI of Public Financial Institutions: These are the deposits in bank accounts from which money can be withdrawn at any time without any advance notice to the bank. Demand deposits thus provide the liquidity necessary for transactions and are a major component of the money supply as they function like cash for the purposes of making payments.
Option (b) correctly identifies the components of M1 included in the question. Time deposits with the post office, mentioned in Option A, are not part of M1 as they are not immediately liquid and cannot be used directly for transactions. They are part of broader money supply measures like M2 or M3, depending on the classification system.