Concept explainers
To ascertain:The difference between the money and the near money.
Explanation of Solution
Money is a matter of economic activity that functions in an economy and function as a way of exchange for the purpose of the transaction. Throughout financial economics, near money is a term that describes extremely volatile non-cash assets that are rapidly converted into cash.
Near money is financial economics describing highly liquid non-cash capital assets that can be transformed quickly into cash. Savings deposits, deposit certificates,
Some of the distinct features of these two type of money are as follows:
Money is a form of bank coins, currency notes, and demand deposits. Money has liquidity of 100 percent. Money is not an asset that yields income.
Whereas near money includes financial assets such as time deposits, bonds, bill of exchange shares, etc. The liquidity of near-money is 100 percent lacking. Earnings yielding assets are near-money assets.
Introduction:Money is also defined in the terms of the three roles or services that it offers. Money also functions as a medium of exchange, as a value shop, and as a unit of account. The most significant role of money is to promote transactions as a means of trade.
Chapter 14 Solutions
Economics Today and Tomorrow, Student Edition
Additional Business Textbook Solutions
Principles of Accounting Volume 1
Horngren's Accounting (12th Edition)
Construction Accounting And Financial Management (4th Edition)
Cost Accounting (15th Edition)
Financial Accounting (12th Edition) (What's New in Accounting)
Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
- Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSONEngineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
- Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education