Because credit card balances and limits can affect the rate of turnover of money supply and contribute to money supply expansion, these balances and limits are included in the M3 definition of money supply.

Question

Quizplus · Accepted Answer

Credit card balances and limits are not included in the M3 definition of money supply. M3 primarily includes more liquid forms of money such as cash, checking deposits, and easily convertible near money. Credit card balances represent debt rather than money supply.

Because Credit Card Balances and Limits Can Affect the Rate