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

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

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

Explain the primary functions of money.


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.

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 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.
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