ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Unit of Account: Unit of account means that the value of each good or service is measured in standard monetary units. The main difficulty that arose in the barter system was deciding the rate at which an exchange had to be carried out.

Detailed explanation-2: -Money acts as a standard of value by making it easy for people to compare the value of different goods and services according to a uniform reference point. Money can also be used as a store of value to make transactions more efficient.

Detailed explanation-3: -Money is a liquid asset used to facilitate transactions of value. It is used as a medium of exchange between individuals and entities. It’s also a store of value and a unit of account that can measure the value of other goods.

Detailed explanation-4: -The unit of account function of money is to provide objective, measurable value to different goods and services. This makes it easy to complete economic transactions, such as buying and selling. A unit of account refers to a measurement that can be used to value goods and services, make calculations and record debt.