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Question : 4
Total: 52
Ms. Iqra Ansari, a teacher, was explaining in her class about various types of deposits with the commercial banks. She quoted that ───
"These deposits form a part of M1 measure of money supply and are payable on demand by the commercial banks."
Identify the type of deposits she was explaining about and choose the correct alternative :
(i) Demand Deposits
(ii) Time Deposits
(iii) Post Office Deposits
"These deposits form a part of M1 measure of money supply and are payable on demand by the commercial banks."
Identify the type of deposits she was explaining about and choose the correct alternative :
(i) Demand Deposits
(ii) Time Deposits
(iii) Post Office Deposits
Solution:
Only (i)
Explanation:
(i) M1 includes demand deposits or chequable deposits of people held with commercial bank. It also includes currency and other deposits.
(ii) M3 includes time deposits with commercial bank.
(iii) M4 includes demand deposits, time deposits along with post office deposits.
Explanation:
(i) M1 includes demand deposits or chequable deposits of people held with commercial bank. It also includes currency and other deposits.
(ii) M3 includes time deposits with commercial bank.
(iii) M4 includes demand deposits, time deposits along with post office deposits.
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