Q.Write a short note on: Near Money

Near money refers to liquid financial assets that can be readily converted into cash but are not themselves used directly as money.

Explanation

Near money means those assets which are close substitutes for money because they can be converted into cash quickly and with little or no loss of value, yet they do not serve directly as a medium of exchange. Examples include bills of exchange, government bonds, treasury bills, fixed and time deposits, and shares and debentures. Such assets possess a high degree of liquidity (nearness to money), which is why they are called near money. They are important because people hold wealth in these forms to earn income while keeping …