Question

Money supply does not include money held by government and banking system, since, money held by them do not come into actual circulation in the country.

• A. True
• B. False

Answer 1

The correct option is A True

Money supply includes the currency that is in circulation with the public at a particular point of time, hence it does not include the money held by government or commercial banks as it is not in circulation with the public at a a given point in time.