Speaking of the demand for money
A)makes no sense in a modern society in which most people use credit cards
B)makes no sense in a modern society in which most people use checks
C)makes sense in a modern society in which most people use checks,since demand deposits are included in M1,but it does not make sense in a society in which the primary payment is by credit card
D)makes sense in a modern society in which most people use credit cards,since credit cards are included in M1,but it does not make sense in a society in which the primary payment is by check
E)is relevant even in a society in which primary payment is by credit card,since eventually all accounts must be settled with money

Question

Quizplus · Accepted Answer

The demand for money is relevant even in a society in which the primary payment is by credit card since eventually all accounts must be settled with money. While credit cards are included in M1, they do not eliminate the need for demand deposits, which are also included in M1. Therefore, the demand for money is still necessary even in a society where credit cards are the primary form of payment.

Speaking of the Demand for Money