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DEMAND OF MONEY

FUNCTIONS OF MONEY
There are two important functions :

1) Serves as store value


2) Acts as medium of exchange
CLASSICAL APPROACH STORE OF VALUE CONEPT
ACCORDING TO LORD KEYNES

• He has given three important reasons for


holding cash balances
1) Transaction demand for money it has 2 types:
• Income motive.
• Business motive.
2) Precautionary demand for money .

3) Speculative demand for money .

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