Knowing the value or price of a good, in terms of money, enables both the supplier and the purchaser of the good to make decisions about how much of the good to supply and how much of the good to purchase.

MONEY

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	medium of exchange
B	unit of account
C	store of value
D	None of the above

Explanation:

Detailed explanation-1: -Monetary value refers to the value of a product or service measured in terms of money.

Detailed explanation-2: -There is a direct relationship between the money supply in the economy and the level of prices of goods and services sold. If we increase the money supply in the left-hand side of the equation, the average price level will increase at the similar pace, which we can observe clearly from the market condition.

Detailed explanation-3: -If there are five goods in a barter economy, one needs to know ten prices in order to exchange one good for another.

Detailed explanation-4: -Money allows us to meet our basic needs-to buy food and shelter and pay for healthcare. Meeting these needs is essential, and if we don’t have enough money to do so, our personal wellbeing and the wellbeing of the community as a whole suffers greatly.

There is 1 question to complete.

ECONOMICS (CBSE/UGC NET)

ECONOMICS

MONEY