Question

What items are not included in M4 measure of supply?

• A. Currency and coins with public
• B. Inter-bank deposits
• C. Other deposits with RBI
• D. Net demand deposits with banks

Answer 1

Answer: (A)

Currency and coins with public

Money supply refers to the total stock of money of all types ( currency as well as demand deposits) held by the people of a country at a given point of time.

Money supply is measured in several ways which includes M1, M2, M3 and M4 measurement of money supply. Every measurement has it own definition with different components varying from most liquid to most rigid form. M4 measurement of money supply is the most rigid among all which do not include currency and coins with public.