ECONOMICS (CBSE/UGC NET)

ECONOMICS

FINANCIAL MARKETS

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Which of the following is an example of money as a unit of account?
A
Purchasing a toy for $8.99.
B
Lending a friend $25.00.
C
Opening a saving account at a bank.
D
Checking the price of a camera at several stores before buying it at the lowest price.
Explanation: 

Detailed explanation-1: -The correct answer is C) comparing camera prices at different stores before buying one. The statement that is an example of money as a unit of account is “comparing camera prices at different stores before buying one."

Detailed explanation-2: -A unit of account can be divided so that its component parts will equal the original value. If you divide a dollar into four quarters, the total value of the four quarters still equals a dollar. Likewise, if you cut a bar of gold in half, the two pieces together will equal the same value as the original bar as a whole.

Detailed explanation-3: -Money can be defined as the medium of exchange, such as notes, coins, and demand deposits, used to pay for commodities and services.

Detailed explanation-4: -Checkable deposits are not classified as money because they fail to provide a store of value. By functioning as a unit of account, money provides a common measurement of the relative value of goods and services.

Detailed explanation-5: -Which of the following is an example of money as a unit of account? Checking the price of a camera at several stores before buying it at the lowest price.

There is 1 question to complete.