Which statement most accurately describes the effect financial technology has had on the demand for money in the United States?
A) Advances in financial technology have all decreased the demand for money.
B) Advances in financial technology have all increased the demand for money.
C) Some advances in financial technology have increased the demand for money while others have decreased it.
D) Advances in financial technology have had no effect on the demand for money.
E) It is not possible to tell what would be the effect because financial technology has not changed over the past three decades.

Question

Quizplus · Accepted Answer

While some financial technologies, such as electronic transfers and digital wallets, may reduce the need for physical currency, others, such as online shopping and peer-to-peer lending, may increase the demand for money overall. Therefore, it is likely that some advances in financial technology have increased the demand for money while others have decreased it.

Which Statement Most Accurately Describes the Effect Financial Technology Has