Final answer:
Under the heading of "cash," credit cards are not included because cash comprises currency notes, coins, and cheques, which represent money that is readily accessible for transactions. Credit cards represent a line of credit rather than actual money.
Step-by-step explanation:
All of the following may be included under the heading of "cash" except credit cards. Cash typically includes currency notes, coins, and cheques, as they represent money that is readily available for transactions.
Regarding the list of items and their designation in M1 or M2 money supplies:
- a. Your $5,000 line of credit on your Bank of America card is neither M1 nor M2, as it represents potential borrowing, not actual money in circulation.
- b. $50 dollars' worth of traveler's checks you have not used yet fall under M1, as they are easily accessible and can be used as a medium of exchange.
- c. $1 in quarters in your pocket is part of M1, being physical currency in circulation.
- d. $1200 in your checking account is also M1, considering it is part of checkable deposits.
- e. $2000 you have in a money market account would belong in M2, because it's a part of near-moneys that can be converted to cash quickly.