ECONOMICS (CBSE/UGC NET)

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ECONOMICS

MONEY

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
When people hold money, theyare using money to maintain value until theywant to exchange that value for a good or service.A) Measure of ValueB) Store of ValueC) Medium of Exchange
A
A
B
B
C
C
D
None of the above
Explanation: 

Detailed explanation-1: -In modern economies, the medium of exchange is currency.

Detailed explanation-2: -A store of value is essentially an asset, commodity, or currency that can be saved, retrieved, and exchanged in the future without deteriorating in value.

Detailed explanation-3: -Money as a measure of value, helps in determining the value of goods and services in the economy. Money is taken as the common denominator while measuring the value of goods and services in the economy. Therefore, with the help of this function everything can be measure in a common denominator or unit.

Detailed explanation-4: -First, money serves as a medium of exchange, which means that money acts as an intermediary between the buyer and the seller. Instead of exchanging accounting services for shoes, the accountant now exchanges accounting services for money. This money is then used to buy shoes.

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