ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -1) General acceptability-The thing which acts as money must be easily accepted by all without hesitation for exchange. 2) Divisibility-It should be divisible into different denominations, e.g., 5 rupees, 10 rupees, 50 rupees, etc. 3) Durability-It should be durable.

Detailed explanation-2: -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-3: -In order for money to function well as a medium of ex-change, store of value, or unit of account, it must possess six characteristics: divisible, portable, acceptable, scarce, durable, and stable in value.

Detailed explanation-4: -Portability: Money must be easily moved around. Large or bulky items, such as boulders or heavy gold bars, cannot be transported easily from place to place. Divisibility: Money must be capable of being divided into smaller parts. Divisible forms of money help make transactions of all sizes and amounts possible.