Question

1. Canada and Sweden have two of the most cashless economies in the world. Investigate this issue by answering the following:

1. Cite two reasons why these nations have been moving away from using cash?
2. Are the reasons given in part a) transferrable to any other developed economy? That is, would the reasons apply equally well to the U.K, France, or any other developed nation?
3. Identify two negative externalities of moving away from cash from the federal government’s perspective. Remember to first cite a primary activity/reason for the nation you have in mind.

Answer 1

Answer a)

Sweden and Canada are moving away from using cash because of the risk of theft and also because of the cost of minting and distributing cash.

Answer b)

Above reasons transfers equally well to other developed nations as every nation has the threat of theft and also has to bear the cost for minting and distributing cash.

Answer c)

1) Numerous individuals like the older are not used to paying by electronic methods (plastic cards or web). The issue with the "cashless economy" is that it doesn't give direct data about the measure of cash left and about the consequences of execution by electronic methods for individual records. So the obtaining power is misty.

2) There are also the dangers of overspending by less taught individuals, children and by individuals that wouldn't fret "compromising" is expanded in a cashless economy.