ECONOMICS
FEDERAL RESERVE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Money is a measurement of value
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Money is accepted in exchange for goods/services
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Money can maintain value over time
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None of the above
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Detailed explanation-1: -In economics, unit of account is one of the money functions. A unit of account is a standard numerical monetary unit of measurement of the market value of goods, services, and other transactions.
Detailed explanation-2: -Unit of Account: Unit of account means that the value of each good or service is measured in standard monetary units. The main difficulty that arose in the barter system was deciding the rate at which an exchange had to be carried out.
Detailed explanation-3: -You can measure the value of money by how much it will buy in foreign currencies, the demand for Treasury notes, and how much is held in foreign exchange reserves. When the value of money declines over time and the prices of goods increase, it is called inflation.
Detailed explanation-4: -The Functions of Money By definition, it is a medium of exchange. It also serves as a unit of account and as a store of value-as the “mack” did in Lompoc.
Detailed explanation-5: -The unit of account function of money is to provide objective, measurable value to different goods and services. This makes it easy to complete economic transactions, such as buying and selling. A unit of account refers to a measurement that can be used to value goods and services, make calculations and record debt.