In the Keynesian system speculative demand for money arises because of, 1 : uncertainty of future interest rate. 2 : unexpected expenditures. 3 : To bridge the gap between income and eventual expenditures. 4 : Relationship between changes in the interest rates and bond price. Codes :

Related MCQs

• Assertion (A) : There exits inverse relationship between interest rates and bond prices. Reason (R) : A bond price represents the present discounted value of the payments agreed upon at the time when the bond was issued. Codes :
• Assertion (A): According to Keynes, individuals hold either cash or all bonds. Reasoning (R): Because, according to him, the speculative demand for money is associated with uncertainty. Codes:
• Relationship between changes in the interest rates and bond prices Codes :
• Assertion (A) : In liquidity trap, the demand for money is perfectly interest elastic. Reason (R) : Because in this situation, all the investors expect the market rate of interest to rise towards the natural rate of interest. Codes :
• Speculative demand for money is zero when market rate of interest is
• According to Milton Friedman Theory of permanent component of consumption-expenditure depends on i. Transitory income alone ii. Transitory and permanent income iii. Permanent income alone iv. Windfall gains Codes :
• In the very short term, in the Keynesian model which of the following is fixed and does not change when GDP changes
• If the Keynesian consumption function is C=10+0.8Yd then, if disposable income is 1000, what is amount of total consumption ?
• A decrease in expected future income, ______ consumption expenditure and ______ saving.
• Using Keynesian multiplier, MPC= 0.8 and government spending increased by 40 billion dollars. How much will GDP increased?