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Which of the following statements is true? A) Money Supply is a stock concept B) Currency and Coins with public are not included in M3 measure of
Question

Which of the following statements is true?
A) Money Supply is a stock concept
B) Currency and Coins with public are not included in M3 measure of money supply

A.

Only A

B.

Neither A nor B

C.

Both A and B

D.

Only B
 

Correct option is A

The correct answer is (a) Only A
Money Supply is a stock concept - This statement is true. Money supply refers to the total amount of monetary assets available in an economy at any specific time. It is measured at a particular point in time, hence it is considered a "stock" concept, much like inventory levels.
Currency and Coins with the public are not included in M3 measure of money supply - This statement is false. M3 is a broad measure of money supply that includes M1 (which consists of currency and coins among other things) plus additional forms of money like time deposits, institutional money market funds, and larger liquid assets. Therefore, currency and coins with the public are indeed included in M3.
The correct answer is (a) Only A
 

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