Maharashtra State Board course HSC Science (General) 12th Board Exam
Share
Notifications

View all notifications

Write Answer in 'One' Or 'Two' Paragraph .Explain the Primary Functions of Money. - Economics

Login
Create free account


      Forgot password?

Question

Write answer in 'one' or 'two' paragraph .

Explain the primary functions of money.

Solution

There are two main primary functions of money:
i. Medium of exchange - Money acts as a medium of exchange as it facilitates exchange through a common medium i.e. facilitates exchange through currency. With money as a medium, the two components of a transaction, namely sale and purchase, can be easily separated.
ii.  Unit of value - Money serves as a common medium or unit of value. The goods and services are of different types and are measurable in different units such as meter, litre, gram etc. Money has provided a common yardstick to measure all these different units in a common denomination known as price. This has made different goods and services comparable to each other in terms of their respective prices.

  Is there an error in this question or solution?

APPEARS IN

 2012-2013 (March) (with solutions)
Question 4.1.3 | 4.00 marks
Solution Write Answer in 'One' Or 'Two' Paragraph .Explain the Primary Functions of Money. Concept: Function of Money - Primary Function.
S
View in app×