People hold speculative balances of money when they anticipate that the price of other assets will fall. Which of the following factors affects these expectations?

Question

Quizplus · Accepted Answer

All of the factors listed can affect expectations about the future prices of assets, thereby influencing speculative balances of money. Changes in exchange rates, foreign interest rates, and government economic policy statements can all signal potential shifts in the economic environment that might lead to changes in asset prices.

People Hold Speculative Balances of Money When They Anticipate That