Economics Principles For A Changing World
4th Edition
ISBN: 9781464186660
Author: CHIANG, Eric P.
Publisher: Worth Publishers,
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Question
Chapter 22, Problem 1QP
To determine
The three functions of money.
Expert Solution & Answer
Explanation of Solution
Money is an asset that is widely accepted as a means of payment. The main functions of money are listed below:
- Medium of exchange: Money acts as a medium of exchange to pay for the goods and service.
- Unit of account: As a unit of account, money is used to measure the value of goods and services in the economy.
- Store of value: Money has the store of value. This function facilitates the exchange of goods and services over time.
Thus, the three main functions of money are medium of exchange, unit of account, and store of value.
Economics Concept Introduction
Money: Money refers to the medium of exchange in a form of paper currency and coins, which are used to make payment for all the commodities and services.
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Chapter 22 Solutions
Economics Principles For A Changing World
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