Question
Match the following: A) M0 P) broad money
B) M1 Q) monetary base C) M2 R) narrow money D) M3 S) broad moneySolution
M0 (monetary base) = Currency in Circulation + Bankers' Deposits with the RBI + 'Other' Deposits with the RBI M1 (narrow money) = Currency with the Public + Demand Deposits with the Banking System + 'Other' Deposits with the RBI M2 and M3 (broad money) M2 = M1 + Time Liabilities Portion of Savings Deposits with the Banking System + Certificates of Deposit issued by Banks + Term Deposits of residents with a contractual maturity of up to and including one year with the Banking System (excluding CDs) M3 = M2 + Term Deposits of residents with a contractual maturity of over one year with the Banking System + Call/Term borrowings from 'Non-depository' Financial Corporations by the Banking System For details please read at https://www.rbi.org.in/Scripts/PublicationReportDetails.aspx?ID=293
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