Speculative demand for money is zero when market rate of interest is
A. more than the ‘critical rate’.
B. More than the market rate of interest but less than the critical rate (i.e. capital gains occur).
C. less than the market rate of interest.
D. Lowest (i.e. in liquidity trap).
Answer:A
Speculative demand for money is zero when market rate of interest is
A. more than the ‘critical rate’. B. More than the market rate of interest but less than the critical rate (i.e. capital gains occur). C. less than the market rate of interest. D. Lowest (i.e. in liquidity trap).