Post Utme Oau 2021 Economics Question 36

Practice objective / multiple choice question 36 from the 2021 Post Utme Oau Economics examination.

Post Utme Oau 2021 Economics Objective / Multiple Choice
Question 36 POST_UTME_OAU • 2021 • ECONOMICS • objective

The demand for money in an economy is influenced by the opportunity \cost of holding money. What is the opportunity \cost of holding money, and how does it affect the demand for money?

Answer Options

Correct Answer A. The opportunity \cost of holding money is the interest that could be earned by investing in alternative assets, and it affects the demand for money by increa\sing it.
B. The opportunity \cost of holding money is the risk of holding money, and it affects the demand for money by decrea\sing it.
C. The opportunity \cost of holding money is the liquidity of holding money, and it affects the demand for money by increa\sing it.
D. The opportunity \cost of holding money is the inflation rate, and it affects the demand for money by decrea\sing it.
Correct Answer
A
Correct Option:
The opportunity \cost of holding money is the interest that could be earned by investing in alternative assets, and it affects the demand for money by increa\sing it.

About This Question

This is Post Utme Oau 2021 Economics Question 36. It is one of the objective questions from the 2021 Post Utme Oau Economics examination.

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