Tobin's Model of the Speculative Demand for Money Shows That

question 9

Multiple Choice

Tobin's model of the speculative demand for money shows that people hold money as a ________ as a way of reducing ________.

• A)medium of exchange;transaction costs
• B)medium of exchange;risk
• C)store of wealth;transaction costs
• D)store of wealth;risk

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Definitions:

Spending Variance

The difference between the actual amount spent in a budget category and the amount that was originally budgeted, indicating over or under-spending.

Customers Served

Refers to the total number of customers who have been provided with a service or product within a specific time frame.

Spending Variance

The difference between the actual amount spent and the budgeted amount for a particular period or item.

Actual Level

The real, measured level of production, performance, or activity, as opposed to planned or theoretical levels.