Question

Read the following text carefully:
\textit{``This function of money provides different items to be evaluated against a common standard. It allows comparison of prices and keeping financial records.''}
(i) On the basis of the given text, identify the indicated function of money.
(ii) List any other two functions of money.

Hint:

Unit of account helps compare values, while medium of exchange and store of value ease transactions and saving.

Answer 1

(i) Indicated Function: Unit of Account (or Measure of Value) — This function of money allows various goods and services to be measured and compared against a common standard, facilitating financial record-keeping. (ii) Any other two functions of money:
Medium of Exchange: Money facilitates buying and selling of goods and services.
Store of Value: Money acts as a medium to store wealth and purchasing power for future use.