Graphically combined transactions and asset demand
Describe how transactions demand and asset demand both can be combined graphically to estimate total money demand.
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In a graph measuring the interest rate vertically & the amount of money demanded horizontally, the two of the demands for the money curves can be summed up horizontally to obtain the total demand for money.
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Explain negative consequences of a company holding too much cash? A company holding too much cash would be giving up the chance to invest more in income generating assets
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