Question

What is the definition of Near money?

• A. Asset which is not usable as a medium of exchange but has as store of value
• B. Asset that serves as a temporary medium of exchange but has a store of value
• C. Asset which adequately fulfils the store of value function and is readily convertible into a medium of exchange but s not itself a medium of exchange
• D. Asset which has a store of value and 100% liquidity

Answer 1

Answer: (C)

Asset which adequately fulfils the store of value function and is readily convertible into a medium of exchange but s not itself a medium of exchange

An asset, which like money acts as a store of value but which is not immediately accepted as a medium of exchange.For example, a building society deposit.What constitutes money and what does not, however, is controversial and important for defining the money supply.