ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -To summarize, money has taken many forms through the ages, but money consistently has three functions: store of value, unit of account, and medium of exchange. Modern economies use fiat money-money that is neither a commodity nor represented or “backed” by a commodity.

Detailed explanation-2: -Money serves several functions: a medium of exchange, a unit of account, a store of value, and a standard of deferred payment.

Detailed explanation-3: -Money as a measure of value, helps in determining the value of goods and services in the economy. Money is taken as the common denominator while measuring the value of goods and services in the economy. Therefore, with the help of this function everything can be measure in a common denominator or unit.

Detailed explanation-4: -The correct answer is D. First, it is used as a medium of exchange, whereby it is widely accepted by the government.