Money market deposit accounts are included in:
Question
Money market deposit accounts are included in:
Solution
Money market deposit accounts are included in the broader category of "M1" and "M2" money supply. Specifically, they are part of the M2 money supply, which encompasses all elements of M1 (physical cash and checking accounts) plus savings accounts, time deposits under $100,000, and money market deposit accounts.
The key characteristics of money market deposit accounts include their limited check-writing ability and typically higher interest rates compared to traditional savings accounts. They serve as a more liquid form of investment as they allow relatively easy access to funds while still offering interest income, making them a popular choice among savers looking for liquidity and yield.
In summary, money market deposit accounts play a role in measuring the money supply in the economy, specifically within the M2 category, which is crucial for understanding economic indicators and trends.
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