What are the functions of money?
The functions of money include serving as a medium of exchange, unit of account, store of value, and standard of deferred payment.
Why is money considered a medium of exchange?
Money facilitates the buying and selling of goods and services by acting as an intermediary in transactions. It eliminates the need for barter, making trade more efficient.
How does money act as a unit of account?
Money provides a common measure for expressing the value of goods and services. Prices are denominated in a monetary unit, enabling easy comparison and valuation.
What does it mean for money to be a store of value?
Money serves as a repository of wealth over time. Individuals can hold money with confidence that it will retain its value, allowing for future purchases.
Why is money considered a standard of deferred payment?
Money allows for transactions where payment is postponed to a future date. Contracts and agreements often involve the use of money as a standard for deferred payment.
What are the functions of money?
The functions of money include serving as a medium of exchange, unit of account, store of value, and standard of deferred payment.
Why is money considered a medium of exchange?
Money facilitates the buying and selling of goods and services by acting as an intermediary in transactions. It eliminates the need for barter, making trade more efficient.
How does money act as a unit of account?
Money provides a common measure for expressing the value of goods and services. Prices are denominated in a monetary unit, enabling easy comparison and valuation.
What does it mean for money to be a store of value?
Money serves as a repository of wealth over time. Individuals can hold money with confidence that it will retain its value, allowing for future purchases.
Why is money considered a standard of deferred payment?
Money allows for transactions where payment is postponed to a future date. Contracts and agreements often involve the use of money as a standard for deferred payment.
