ECONOMICS
MONEY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Medium of exchange
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Measure of value
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Store of value
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None of the above
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Detailed explanation-1: -Currency is the most common medium of exchange accepted as a standard by all parties for settling economic transactions. In modern economies, currency as a medium of exchange has made economic dynamics possible.
Detailed explanation-2: -Money is called medium of exchange because money is a widely accepted token that can be used for exchange of any good or service. In old days, barter system was used as medium of exchange and later it was gold.
Detailed explanation-3: -"medium of exchange” and “means of payment.” The former refers to the set of assets in an economy that people regularly exchange for goods and services (a concept of “what"), while the latter is a method that facilitates delivery of money from one to another (a notion of “how").
Detailed explanation-4: -Money is any object that is generally accepted as payment for goods and services and repayment of debts in a given country or socio-economic context.