Question 44
Money and InflationDemand for money for speculative purposes means
- A.buying goods and services whose prices have risen
- B.keeping money for unforeseen expenditure.
- C.buying financial assets because of possible gains
- D.buying real estate
- E.keeping money for a rainy day.
Show the answer and explanation
Answer: C (buying financial assets because of possible gains)
Explanation
People hold money speculatively so they can buy bonds and other financial assets when prices change in their favour and make a gain.