What Is the "Unit of Account" Function of Money

question 6

Multiple Choice

What is the "unit of account" function of money?

• A) a common measurement of the relative value of different goods and services
• B) the ability of money to hold value over time
• C) the quality of money not to be hoarded because of its commodity value
• D) the function of money to be widely accepted I exchange for goods and services

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Definitions:

Interest Banks

Financial institutions that primarily engage in dealings with interest rates, offering services such as saving accounts and loans.

Maturity

The state at which an entity, such as a financial instrument or product, has fully developed or reached its maximum potential.

Interest

The cost of borrowing money, often expressed as a percentage of the amount borrowed.

Positive Covenant

Positive covenant refers to stipulations in financial contracts that require the borrower to perform specific actions, such as maintaining certain financial ratios or insurance levels.