ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Money is often defined in terms of the three functions or services that it provides. Money serves as a medium of exchange, as a store of value, and as a unit of account. Medium of exchange. Money’s most important function is as a medium of exchange to facilitate transactions.

Detailed explanation-2: -Money must serve as a measure of value and a medium of exchange.

Detailed explanation-3: -Medium of exchange and measure of value The market measures or sets the real value of various goods and services using the medium of exchange as a unit of measure i.e., standard or the yard stick of measurement of wealth.

Detailed explanation-4: -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-5: -A medium of exchange. A standard of deferred payment. A store of wealth. A measure of value. 13-Dec-2022