ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Its value comes from being declared “legal tender"-an acceptable form of payment-by the government of the issuing country. In this case, we accept the value of the money because the government says it has value and other people value it enough to accept it as payment.

Detailed explanation-2: -In general, there are six characteristics of money that allow it to serve its primary functions: durability, portability, divisibility, uniformity, limited supply, and acceptability.

Detailed explanation-3: -Answer and Explanation: Universal acceptability is so important because people want to be able to use money everywhere or conducting economic transactions. If money did not have universal acceptability, it will lose its value as people would not know in which transactions they can use money and in which they cannot.

Detailed explanation-4: -Finally, another function of money is that money must serve as a standard of deferred payment. This means that if money is usable today to make purchases, it must also be acceptable to make purchases today that will be paid in the future.