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Q: Which of the following statements is/are correct about speculative demand for money? i. It is perfectly interest elastic. ii. It is relatively interest elastic. iii. It is perfectly interest inelastic. iv. It is relatively interest inelastic
  • A. Only ii
  • B. Only i and ii
  • C. Only iii
  • D. Only iii and iv
Correct Answer: Option A - Regarding speculative demand for money statement (ii) is correct because speculative demand for money refers to the demand for money to hold as an asset rather than for transactional purposes. It is Relatively interest elastic, which means that changes in interest rates have a relatively small impact on the demand for money as an asset.
A. Regarding speculative demand for money statement (ii) is correct because speculative demand for money refers to the demand for money to hold as an asset rather than for transactional purposes. It is Relatively interest elastic, which means that changes in interest rates have a relatively small impact on the demand for money as an asset.

Explanations:

Regarding speculative demand for money statement (ii) is correct because speculative demand for money refers to the demand for money to hold as an asset rather than for transactional purposes. It is Relatively interest elastic, which means that changes in interest rates have a relatively small impact on the demand for money as an asset.