ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -In the monetary economy, money is considered a store of value, where it can be used as a means of saving and allocating capital. Money’s property as a store of value facilitates a transfer of purchasing power over time.

Detailed explanation-2: -Money has a store of value because it is an asset that can be invested, stored in a bank, left in a safe at home, and then later used to purchase something in the future. Store of value is an important money function because it helps facilitate trade in the future.

Detailed explanation-3: -A store of value is any commodity or asset that would normally retain purchasing power into the future and is the function of the asset that can be saved, retrieved and exchanged at a later time, and be predictably useful when retrieved.

Detailed explanation-4: -Commodity money is a kind of payment that has the potential to transform into a good or service for production or consumption. For instance, metals such as gold, silver, and others were used to create jewelry as well as to exchange for things in the early days.

Detailed explanation-5: -Money as a Store of Value So, when people exchange items for money, that money retains a particular value that can be used in other transactions. This ability to function as a store of value facilitates saving for the future and engaging in transactions over long distances.