Function of Money

Question 1

function of money

Answer 1

a medium
a measure
a standard
a store

Question 2

a medium of exchange

Answer 2

when money is used to intermediate the exchange of g/s

thereby avoids inefficiencies of a barter system

a method for comparing values of dissimilar objects

Question 3

a measure of value

Answer 3

provides a common measure of the value of g/s being exchanged

TO FUNCTION :

• divisible into smaller units without loss of value
• fungible ~ one unit or piece must be perceived as equivalent to any other
• a specific weight or measure or size to be verifiably countable

Question 4

a standard of deferred payment (not paid yet)

Answer 4

an accepted way to settle a debt

Question 5

a store of value

Answer 5

money must be reliably saved, stores & retrieves & predictably usable as a medium of exchange when retrieved
the value of the money must remain stable over time ~ inflation fucks it up

Question 6

role of money and interest rates

Answer 6

anything that is seen as flat money, declared legal tender by the gov

Question 7

spectrum of liquidity

Answer 7

shows how close money is to cash and how easy it is to use as payment for g/s

liquid = easy to turn into cash
illiquid = not easy