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Demand for Money

Demand for Money - some people demand it for hoarding or...

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Demand for Money : The demand for money is made in the form of currency or cash possessed or in the form of checkable and quickly withdrawable saving deposits . All such demands are mainly meant for carrying out a variety of activities . There are household demands for purchasing several consumption goods, for payment of services of doctors, teachers, for purchasing durable goods like property or automobiles etc. A firm or a trader demands money for purchasing raw materials or plant and machinery, for the payment of wages, salaries and other factor payments etc. Besides such a demand for money in order to carry out various transactions,
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Unformatted text preview: some people demand it for hoarding or holding wealth in liquid form. It can conveniently be used according to variations in the market conditions. Each of these purposes is called motive for demanding money . There are three chief motives for which money is demanded. These are transactions , precaution and speculation . The first two motives are traditional and classical economists made use of them. The third motive of speculation is modern ; Keynes has introduced and analyzed this particular motive....
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