Which of the following determine demand for money?
i. Interest rates
ii. Quantum of transactions
iii. Value of transactions
iv. Income of an individual

All of them

The correct answer is Option 4: All of them

All the listed factors—interest rates, the quantum of transactions, the value of transactions, and the income of an individual—play a role in determining the demand for money.

• Interest rates affect the opportunity cost of holding money.
• Quantum of transactions and value of transactions influence the need for liquidity.
• Income of an individual affects how much money is needed for spending.

"Since money is required to conduct transactions, the value of transactions will determine the money people will want to keep: the larger is the quantum of transactions to be made, the larger is the quantity of money demanded. Since the quantum of transactions to be made depends on income, it should be clear that a rise in income will lead to rise in demand for money. When interest rates go up, people become less interested in holding money since holding money amounts to holding less of interest-earning deposits, and thus less interest received. Therefore, at higher interest rates, money demanded comes down."