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Explain five factors that influence the amount of money held by an individual for transaction motive.

      

Explain five factors that influence the amount of money held by an individual for transaction motive.

  

Answers


Kavungya
-The level of household/individual income:
The higher the amount of income the higher the amount of money that an individual would hold for transaction motive.
-The price level/cost of living
The higher the cost of living the higher the amount of money and individual would hold.
-The number of dependants an individual has /family size: Individual with a large family will keep large amount of money for transaction purpose.
- The possibility of getting credit:
The more difficult it is, the higher the amount an individual would hold for transacting propose.
-Lifestyle of an individual / psychological environment.
An individual with an expensive lifestyle or high income neighborhood will hold more money for transactions purpose.
-Pattern of payment /interval between payment
Weekly wage earner will need to hold less than a person who receives his salary monthly.
Kavungya answered the question on September 25, 2019 at 09:32


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