This question was the candidates’ favourite. Most of the candidates who attempted it were able to provide the required answers. Candidates performance in this question was quite impressive
The following were the expected answers from the candidates:
(a) (i) Value of money - This refers to the purchasing power of money
(b) (i) acceptability;
(ii) portability;
(iii) divisibility;
- relative scarcity;
- durability.
(c) (i) Transactions motive – holding money to take care of daily expenses, e.g.
transportation
(ii) Precautionary motive – holding money to take care of unforeseen
circumstances, e.g. sickness.
(iii) Speculative motive - holding money to take advantage of investment
opportunities
