there is a no equivalent cash to the amount of demand deposits with the bank why should the demand deposits taken as a part of money supply
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Demand deposits are included as part of M1 currency—the most liquid types of money—when measuring money supply.
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A demand deposit account (DDA) consists of funds held in a bank account from which deposited funds can be withdrawn at any time, such as checking accounts. DDA accounts can pay interest on a deposit into the accounts but aren’t required. A DDA allows funds to be accessed anytime, while a term deposit account restricts access for a predetermined time....
Demand deposits are usually considered part of the narrowly defined money supply, as they can be used, via checks and drafts, as a means of payment for goods and services and to settle debts....
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