Which of the following are included in M1 definition of money for the Indian economy?<br>1. Reserves<br>2. Currency<br>3. Time deposits<br>4. Demand deposits<br>Select the correct answer using the code given below.
- A. 1 and 3 only
- B. 2 and 3
- C. 2 and 4 ✓
- D. 1, 3 and 4
Correct Answer: C. 2 and 4
Explanation
The M1 monetary aggregate, known as narrow money, consists exclusively of currency with the public, demand deposits with the banking system, and 'other' deposits with the RBI. Time deposits and reserves are not included.
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