Question 18
Money and InflationNear money is made up of
- A.very liquid assets which can be easily converted into money
- B.currency in circulation and demand deposits
- C.notes and coins
- D.fixed assets which cannot be converted into money
- E.the total money supply in the economy.
Show the answer and explanation
Answer: A (very liquid assets which can be easily converted into money)
Explanation
Near money (e.g. treasury bills, savings deposits, bills of exchange) is not money itself but can quickly be turned into money.