. The motives for holding money

Match the correct motive for holding money to each definition in the following table.

Definition	Motive
The stock of money people hold to pay predictable everyday expenses
The stock of money people hold to take advantage of future changes in the prices of financial assets other than money
The stock of money people hold to pay unpredictable expenses

Identify the motive for holding money in the following scenario.

Gilberto moves to a smaller apartment. Because of the lower monthly rent, he places a larger share of funds from his paycheque in a retirement fund and a smaller share in his savings account. This is an example of a decrease in Gilberto's demand for money.

Complete the following statement about the relationship between the interest rate and the demand to hold money for asset purposes.

As the interest rate falls, the opportunity cost of holding money, and the demand for money.