Final answer:
Savings deposits are the component that is included in M2 but not in M1. Currency and demand deposits are included in both M1 and M2.
Step-by-step explanation:
The Relationship Between M1 and M2 Money
When considering the components of the different measures of money supply, M1 includes currency, demand deposits, and other liquid deposits, which means all forms of money that can be easily converted to cash or that are already in cash form. M2 is a broader measure of the money supply that includes everything in M1 plus other forms of savings including savings deposits, money market accounts, certificates of deposit (CDs), and other time deposits. Hence, among the options provided, savings deposits are included in M2 but not in M1, making them the correct answer to the question 'which of the following is included in M2 but not in M1?'. Both currency and demand deposits are included in M1, and by extension, also in M2, as M2 encompasses all elements of M1.