Holding money to take care of contingencies is

JAMB Economics 2024 113 views
Source: JAMB · 2024

Holding money to take care of contingencies is

  1. a speculative motive
  2. a transactions motive
  3. a precautionary motive ✓
  4. an expansionary motive
Explanation

The precautionary motive means keeping money for emergencies. You save cash for unexpected expenses or problems.

Transaction motive is for daily purchases. Speculative motive is for investment opportunities.

People hold precautionary money as a safety net against uncertain future events.

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