The definition of the money supply that includes currency, checkable deposits, and travelers' checks is known as: a) M1. b) M2. c) M3. d) L. The largest component of the money supply (M1) is: a) gold certificates. b) checkable deposits. c) currency in circulation. d) travelers' checks. Checkable deposits are classified as money because: a) they canbe readily used in purchasing goods and paying bills. [3) banks hold currency equal to the value of their checkable deposits. (3) they are ultimately the obligations of the Treasury. d) they earn interest income for the depositor. Which of the following is NOT part of the M2 money supply? a) money market mutual fund balances. b) money market deposit accounts. c) currency. d) large ($100,000 or more) time deposits. The amount of money reported as Mg: a) is smaller than the amount reported as M1. 1)) is larger than the amount reported as M1. c) excludes coins and currency. d) includes large ($100,000 or more) certicates of deposit Liquidity is dened as: a) the cash value of at money. b) the value of fiat money when used to buy a good or a service. c) the speed at which money is spent. d) the ease with which money can be divided to make payments. e) the ease with which an asset can be converted into cash