SSC Economics Sample Paper NCERT Sample Paper-3

  • question_answer
    The sum of which of the following constitutes Broad Money in India?
    A. currency with the public
    B. demand deposits with banks
    C. time deposits with banks
    D. other deposits with RBI

    A)  A and B          

    B)  A, B and C

    C)  A, B, C and D

    D)         A, B and D

    Correct Answer: B

    Solution :

    [b] The four main monetary aggregates of measures of money supply which reflect the state of the monetary sectorare: (i) M1 (Narrow money) = Currency with the public + demand deposits of the public; (ii) M2 = M1 + Post Office Savings deposits; (iii) M3 (Broad money) = M1 + time deposits of the public with banks; and (iv) M4 = M3 + Total post office deposits.

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