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Alexxx [7]
3 years ago
9

Explain the reasons why peopledemand for money​

Business
1 answer:
guajiro [1.7K]3 years ago
3 0

Explanation:

Transactions motive. The transactions motive for demanding money arises from the fact that most transactions involve an exchange of money. ...

Precautionary motive. People often demand money as a precaution against an uncertain future. ...

Speculative motive. Money, like other stores of value, is an asset

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Answer:

1.6 Q1 + 0.875 Q2 = $56

Explanation:

Budget constraint equation represents the total budget allocation to different activities under consideration.

old Budget Constraint

Q1 + Q2 = $56

New Budget Constraint

(Q1)*8/5 + (Q2)*7/8 = $56

(Q1)*1.6 + (Q2)*7/8 = $56

(Q1)*1.6 + (Q2)*0.875 = $56

1.6 Q1 + 0.875 Q2 = $56

So best answer made based on data available.

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Gift of exchange for all goods and services
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Difference: 20,170

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