What is M2?

easily accessible funds, government securities, and large time deposits

large time deposits, money market accounts, and savings instruments

easily accessible funds, money market accounts, and savings instruments

a measure of the funds that are easily accessible or in circulation

1 answer

M2 is a measure of the money supply that includes all elements of M1 (which is cash and easily accessible funds) plus certain near-money assets. Specifically, M2 consists of:

  • Easily accessible funds (M1)
  • Savings accounts
  • Money market accounts
  • Small time deposits (like certificates of deposit under $100,000)

Therefore, the best description from your options would be:

easily accessible funds, money market accounts, and savings instruments.