CFA Practice Question

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CFA Practice Question

The M1 money supply measure does not include ______.

I. demand deposits
II. interest-earnings checkable deposits
III. checkable deposits
IV. traveler's checks
A. II only
B. I and III
C. None of them
Explanation: Checkable deposits (III) include both demand deposits (I) and interest-earning checkable deposits (II)! M1 includes circulating currencies, checkable deposits, and traveler's checks. All of the choices belong to M1.

User Contributed Comments 4

User Comment
CoffeeGirl both demand deposit, interet earning checkable deposits, and checkable deposit are "checking account" items.
cong could anyone explain the difference between checkable deposit and savings deposit?
akils "Checkable deposit" basically means a transactional account, with no conditions regarding deposits and withdrawals.
Anything else like a savings accounts, time deposit accounts or mutual funds have several conditions regarding deposits and withdrawals.
Conor sweet double negative in this question...
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