ECONOMICS
MONEY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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demand deposit
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medium of exchange
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Either A or B
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None of the above
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Detailed explanation-1: -What Is a Demand Deposit? A demand deposit account (DDA) is a bank account from which deposited funds can be withdrawn at any time, without advance notice. DDA accounts can pay interest on the deposited funds but aren’t required to. Checking accounts and savings accounts are common types of DDAs.
Detailed explanation-2: -Demand deposit account definition A demand deposit account is another term for a checking, savings or money market account. Money in these accounts is highly liquid, and you’ll be able to withdraw funds at any time without paying the bank a penalty.
Detailed explanation-3: -A demand deposit is money deposited into a bank account with funds that can be withdrawn on-demand at any time. The depositor will typically use demand deposit funds to pay for everyday expenses. For funds in the account, the bank or financial institution may pay either a low or zero interest rate on the deposit.
Detailed explanation-4: -Examples of demand deposit accounts include regular checking accounts, savings accounts, or money market accounts. [Important: Demand deposits and term deposits differ in terms of accessibility or liquidity, and in the amount of interest that can be earned on the deposited funds.]