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| Q. |
The demand for money, according to Keynes, is for - |
| A. | speculative motive |
| B. | transaction motive |
| C. | precautionary motive |
| D. | All the above motives |
| Answer» C. precautionary motive | |
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Explanation: According to Keynes, money is demanded because of three motives -transaction, precautionary and speculative. The first two motives provide yield of convenience and certainty. The third motive provides money yield. Keynes has termed demand for money as liquidity preference. |
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