What type of account is often referred to as a demand deposit account (DDA)?

A demand deposit account (DDA) is commonly known as a checking account. This type of account allows depositors to withdraw funds at any time, making it very liquid and accessible. Customers can write checks, use debit cards, and make electronic transfers, enabling immediate access to their funds as needed. The essential characteristic of a DDA is that it enables frequent transactions, catering to daily financial management rather than long-term saving.

In contrast, savings accounts are typically designed for saving money over longer periods and might limit the number of withdrawals or transactions allowed within a month. Credit accounts are arrangements for borrowing money where the user pays it back, and loan accounts are specifically used for borrowed funds that require repayment with interest. Therefore, the defining nature of a DDA aligns perfectly with the functions of a checking account, confirming that this choice is indeed the correct answer.