Final answer:
True, money market mutual funds can include tax-exempt funds and government securities funds, and are part of the M2 money supply. They offer high liquidity and low risk by investing in secure financial instruments.
Step-by-step explanation:
The statement that money market mutual funds include tax-exempt funds and government securities funds is true. Money market funds are designed to offer investors high liquidity with a very low level of risk, and are a component of the M2 money supply. These funds pool the deposits of many individuals and invest in secure financial instruments, such as short-term government bonds, which are considered safe investments. The advantage of these mutual funds is their liquidity and professional management, often yielding diversified portfolios that balance returns and risks effectively.