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Home Questions CXVGYHSXDX
Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Money and Banking

Question:
Read the following statements - Assertion (A) and Reason (R):
Assertion: Demand deposits are not the legal tender.
Reasoning: Since demand deposit are with bank, they can be used a s a legal tender by issuing cheques.
From the given alternatives choose the correct one:
Options:
Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).
Assertion (A) is true but Reason (R) is false.
Assertion (A) is false but Reason (R) is true.
Correct Answer:
Assertion (A) is true but Reason (R) is false.
Explanation:
Demand Deposits are not the legal tender. It is issued by the bank and not by the government. Legal tender is the money that is authorized and issued by the order of the government.

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