Measures of Money Supply

Q.

Little (Comparative And Superlative Degrees)

Q.

Explain The Various Classification Of Money.

Q.

Which of the following is the most commonly used measure of money supply?

1. $M_1$

2. $M_2$

3. $M_3$

4. $M_4$

Q.

= + Net time deposits of commercial banks

1. $M_1$
2. $M_2$
3. $M_3$
4. $M_4$

Q.

Which of the following is the most liquid measure of money supply?

1. $M_1$

2. $M_2$

3. $M_3$

4. $M_4$

Q. is the least liquid measure of money supply.

1. $M_1$
2. $M_2$
3. $M_3$
4. $M_4$

Q. State the two components of money supply.
OR
State the components of money supply.

Q. Two main components of money supply are __________.

1. currency and demand deposits
2. currency and coins
3. demand deposits and time deposits
4. all of the above

Q.

Identify the error in the sentence: A lakh rupees are a lot of money.

1. are

2. A

3. money

4. a lot of

Q. Define money supply and explain its components.

Q.

Which of the following is the least liquid measure of money supply?

1. $M_3$

2. $M_4$

3. $M_1$

4. $M_2$

Q. If the price of coffee suddenly shoots up, the demand for tea is expected to ______.

1. move rightward along the original demand curve
2. decrease
3. increase
4. remain unaffected

Q. Answer in details -

Explain primary, secondary and contingent functions of money.

Q. In India other deposits of post office savings are included in __________ money supply.

1. M2
2. M1
3. M3
4. M4

Q.

Money supply is classified into $M_1,M_2,M_3$ and $M_4$ based on:

1. Availability

2. Portability

3. Fungibility

4. Liquidity

Q.

Choose the correct statement.

1. $M_2=M_3$ - Net time deposits

2. $M_3=M_2$ - Post office savings deposits + Net time deposits.

3. $M_4=$ Currency + Deposits - $M_3$

4. $M_1=$ Currency + Deposits - $M_3$

Q. Money supply is classified into $M_1,$$M_2,$$M_3,$and$M_4$based on .

1. availability
2. portability
3. fungibility
4. liquidity

Q.

Narrow money comprises of:

1. $M_1$

2. $M_2$

3. $M_3$

4. $M_4$

Q.

Broad money comprises of:

1. $M_1$

2. $M_2$

3. $M_3$

4. $M_4$

Q. M1 includes net demand deposits and not gross demand deposits, as net demand deposits do not include inter-banking claims.

1. True
2. False

Q. Briefly explain any two determinants of supply.

Q. The money supply comprises of which of the following?

1. is comprised only of Bank of Canada notes and coins in circulation.
2. is comprised only of the deposits of the chartered banks at the Bank of Canada.
3. is a broad definition of financial assets available for use in payments.
4. includes all forms of liquid and less liquid assets such as currency in circulation, term deposits, chequing and savings account deposits, and Canada savings bonds.

Q. Money supply refers to ______________________.

1. Total volume of money held by public at a particular point of time
2. Total volume of money held by public over a period of time
3. Total volume of money held by the government
4. Both (a) and (b)

Q. Money supply includes __________.

1. All Deposits in Banks
2. Only Time Deposits in Banks
3. Currency with the Banks
4. Only Demand Deposits in Banks

Q. According to 1979 classification ________.

1. $M_2$ = $M_1$ + broad money
2. $M_2$ = $M_1$ + Post office time deposits
3. $M_2$ = $M_1$ + Post office savings deposits
4. $M_2$ = $M_1$ + All deposits

Q.

The narrowest section of money supply is:

1. $M_1+M_3$

2. Broad Money

3. Monetary Base

4. Narrow Money

Q. Long Answer Type Questions:
What is meant by 'money supply' ? Discuss, in brief, the various constituents of money supply.

Q. ___________ is the most liquid money supply in India.

1. M1
2. M2
3. M3
4. M4

Q. In a financial transaction, money can be exchanged in the form of _____ .

1. currency notes
2. coins
3. cheques
4. all of these

Q. Which of these is also called broad money?

1. $M3$.
2. $M1$.
3. $M2$.
4. $M4$.