What is the precautionary motive? To provide a fund to cover future uncertainties such as fluctuating income, sickness, inflationary effects on expenditures, etc. To sacrifice today so that your future lifestyle can improve. To provide monies to even out differences in earnings over time. To take advantage of investment opportunities that can make achievement of our financial goals easier, To provide monies for the down payment or full purchase of longer-lived assets such as durable goods or educational expenditures. > Question 23 1 The ability to accumulate investments with no intention of converting them into purchases in the future is the None of the answers are correct. O Precautionary motive The investment motive. Bequest motive Independence motive The ability to turn an asset into cash quickly at a reasonable transaction cost and without loss of principal is: Liquidity. Liquidity substitute Emergency substitute Marketability Question 25 1 Debt and marketable securities are examples of: Liquidity substitutes Equity substitutes Emergency funds. Purchasing power risk. Retirement funding