Functions of Money & Factors Flashcards
1
Q
What are the 4 functions of money:
1.
2.
3.
4.
A
- Unit of account
- Means of exchange
- Store of value
- Legal tender
2
Q
What is unit of account?
A
A measure used to exchange money for an equivalent value of goods.
3
Q
What 3 things encompass means of exchange?
A
Buying, selling, or trading.
4
Q
What is a store of value?
A
Something that keeps value when stored instead of being used.
5
Q
What is legal tender?
A
The official currency of a country.
6
Q
What 5 factors affect the role/ view of money:
1.
2.
3.
4.
5.
A
- Personal attitudes
- Life stages
- Culture
- Financial events
- Interest rates
