Question

Why are demand deposits considered as money.

Answer 1

Answer:

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• The is it can be demand deposits can be withdrawn on demand.
• The demand deposits possesses the essential characteristics of money that is medium of exchange.
• Since demand deposit are accepted widely as a means of payment, along with currency, because cute money in the modern economy.

Answer 2

Answer:

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Why are demand deposits considered as money.

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(i) Demand deposits can be withdrawn from the bank whenever it is required.

(ii) They are widely accepted as a means of payment, along with the currency, thus they aqre considered as money.

(iii) They are accepted widely as means of payment by way of a cheque instead of cash.

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