the motives for holding money match the correct motive for holding money to the
ID: 1121655 • Letter: T
Question
the motives for holding money match the correct motive for holding money to the following definitions •Identify the motive for holding money in the following scenario (drop down options) Transactions/ speculative/ precautionary•complete the following statement about the relationship between the interest rate and speculative balances (drop down options) 1. Rises/falls 2. Increase/ decrease
Drop down options for motives and definitions are shown in picture. Please help with all! Thanks
Match the correct motive for holding money to the The stock of money people hold to take advantage of tuure changes in the prices of financial assets otier than money demand for money The slock of money people hoid to pay unpredictable expenses Specultive demand for money The stock of money poople hoid to pay everyday predictable expenses Transactons demand for money Identify the motive for holding money in the folowing scenario Musashi moves to a smaller apartment. Because of the lower monthly rent, he places a larger share of funds fron his paycheck in a retirement fund and a smaller share in his savings account. This is an example of a decrease in Musashi's demand for money, Complete the following statement about the relationship between the interest rate and speculative balances. As the interest rate rises, the opportunity cost of holding money and people their speculative balances. Grade It Now Continue without saving 144 9 0 0
Explanation / Answer
Statement 1: Speculative demand for money
Statement 2: Precautionary demand for money
Statement 1: Transaction demand for money
Answer to blank 1: Transaction
Explanation:
Because demand for money for paying rent is a Transaction demand for money which decreases here.
Answer to blank 2: rises
Answer to blank 3: decrease
Explanation:
The speculative demand for money is negatively related to interest rate.
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