Answer: Option (D) is correct.
Explanation:
Correct Option: M1 plus savings account balances plus small-denomination time deposits plus non-institutional money market fund shares.
M1 consists of:
M1 = currency with public + demand deposits + check able deposits + other deposits with RBI
M2 consists of:
M2 = M1 + post office saving A/C + small-denomination time deposits + non-institutional money market fund shares
Therefore, the monetary aggregate, M2, includes all the elements of M1, post office savings A/C, small-denomination time deposits and non-institutional money market fund shares.
Large denomination time deposits are included in M3 because it includes amounts greater than $100000.