Credit cards are not considered a part of the money supply because they represent a method of deferring payment rather than being a store of value, unit of account, or medium of exchange themselves. They allow users to borrow money up to a certain limit to purchase goods and services, but they do not constitute money in their own right.

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Credit Cards

Question 66

Multiple Choice

Credit cards

A) are not a part of the money supply because they are not a deferred standard of payment,store of value,or unit of account.
B) are a part of M1 but not of M2.
C) are a part of the money supply because they are used to purchase goods and services.
D) are a part of M2 but not a part of M1.

Correct Answer: