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WAEC Economics 2019 Question 35

Question 35

Money and Inflation

The motive for holding money to meet unforeseen events is termed

  1. A.precautionary demand.
  2. B.transactions demand.
  3. C.liquidity demand.
  4. D.speculative demand.
Show the answer and explanation

Answer: A (precautionary demand.)

Explanation

Money kept for emergencies is the precautionary motive.