The reason why a savings account is not considered a component of the M-1 money supply is that it bears interest.

Name: The reason why a savings account is not considered a component of the M-1 money supply is that it bears interest.
Brand: Quizplus
Rating: 4.7 (35 reviews)

Question

Quizplus · Accepted Answer

The reason a savings account is not considered a component of the M-1 money supply is because it is not as liquid as other forms of M-1 money, such as cash and checking accounts, not specifically because it bears interest.

The Reason Why a Savings Account Is Not Considered a Component