The speculative demand curve for money is:
A) downward sloping.
B) upward sloping.
C) vertical.
D) horizontal.
E) spiral.

Question

Quizplus · Accepted Answer

The speculative demand for money is the demand to hold money as an asset, in order to take advantage of future investment opportunities or changes in interest rates. As interest rates increase, the opportunity cost of holding money increases, causing individuals to demand less money for speculative purposes. This leads to a downward-sloping speculative demand curve for money.

The Speculative Demand Curve for Money Is