Define the three functions of money
What will be an ideal response?
The medium of exchange enables one to undertake transactions. The unit of account denotes the prices of goods and services and debts are quoted in terms of the currency. The store of value enables one to make purchases over time.
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Economic surplus
A) is equal to the difference between consumer surplus and producer surplus. B) is equal to the sum of consumer surplus and producer surplus. C) does not exist when a competitive market is in equilibrium. D) is the difference between quantity demanded and quantity supplied when the market price for a product is greater than the equilibrium price.
When loans are repaid at commercial banks:
A. Money is created B. Money is destroyed C. The assets of commercial banks increase D. The net worth of commercial banks increases