Which of the following best describes the transactions demand for money?Multiple choice question.People hold money because it can be used as an asset.People hold onto money when inflation is high.People need money as a precaution.People need money to buy goods and services.
Question
Which of the following best describes the transactions demand for money?Multiple choice question.People hold money because it can be used as an asset.People hold onto money when inflation is high.People need money as a precaution.People need money to buy goods and services.
Solution
The best description for the transactions demand for money is: People need money to buy goods and services.
This is because the transactions demand for money refers to the amount of money people need to carry out their everyday transactions. It is the money needed for immediate or near-future purchases. This demand is influenced by the level of income and the timing and predictability of expenses.
Similar Questions
Which of the following describes the transactions demand for money?Multiple choice question.The money needed to buy goods and servicesThe demand for money as a store of wealthThe demand for money to guard against having a tyre puncture when on holidayThe demand for money as a backup to pay for occurrences that are not regular
Which of the following describes the transactions and precautionary demand for money?Multiple choice question.The demand for money to transfer the purchasing power from the present to the futureThe demand for money as a yardstick for measuring the relative worth of goods and servicesThe demand for money as a medium of exchangeThe demand for money as a store of value
What kind of demand occurs when people spend money on a regular daily basis for goods and services they need and want?Multiple choice question.Transactions demandAsset demandPrecautionary demandSpending demand
The desire of people to hold money as a medium of exchange describes what type of money demand?Multiple ChoiceThe velocity of circulation.The transactions demand for money.The asset demand for money.The investment demand.
Multiple Choice QuestionWhat is the primary purpose of money in a society?Multiple choice question.To trade one good or service for another good or service of similar valueTo serve as a limited-supply commodity that offers a service of valueTo enable a person or organization to trade money for a good or a serviceTo serve as a value for services
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.