A. interest rate
B. level of income
C. exchange rate
D. inflation rate

Correct Answer:

Option A – interest rate

Explanation

The speculative demand for money is simply a need for money for investment purposes, which is indirectly influenced by interest rates. When the rates of interest is high, people would most likely want to invest their money so as to get a high return on investment.

SEE ALSO  If income rises from N2000 to N4000 and quantity demanded increase from 80 units to 120 units; find the income elasticity of demand?

Copyright warnings! Do not copy.