Question : Which of these statements is true?
Option 1: At lower rates of interest, people will have a lower preference for liquidity.
Option 2: At higher rates of interest transactions, demand for money will be higher.
Option 3: At lower rates of interest, speculative demand for money will be higher.
Option 4: At higher rates of interest, the liquidity preference of people will increase.
New: SSC CHSL tier 1 answer key 2024 out | SSC CHSL 2024 Notification PDF
Recommended: How to crack SSC CHSL | SSC CHSL exam guide
Don't Miss: Month-wise Current Affairs | Upcoming government exams
New: Unlock 10% OFF on PTE Academic. Use Code: 'C360SPL10'
Correct Answer: At lower rates of interest, speculative demand for money will be higher.
Solution : The correct option is At lower rates of interest, speculative demand for money will be higher .
According to the theory of liquidity preference proposed by J. M. Keynes, speculative demand for money is influenced by the prevailing interest rates. Specifically, when interest rates are lower, people tend to hold less money for transactions and more for speculative purposes.
Candidates can download this e-book to give a boost to thier preparation.
Result | Eligibility | Application | Admit Card | Answer Key | Preparation Tips | Cutoff
Question : When the rate of interest is at its maximum, which of the following will follow?
Question : Which of the following statements is/are correct regarding the liquidity trap?
i. It is where speculative demand for money is infinitely inelastic and the liquidity preference curve becomes perfectly elastic. ii. It is where speculative demand for money is
Question : Government borrowing to finance budget deficits ____________.
Question : When the general interest rate reaches a low level, which of the following statements will be correct?
Question : The Monetary Policy Committee maintained a hawkish stance on the interest rates. In this context, the 'hawkish stance' means_____.
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile