When Economists Say That Money Serves as a Unit of Account,they

question 114

Multiple Choice

When economists say that money serves as a unit of account,they mean that money

• A)allows people to avoid barter (trading goods for other goods)by using money.
• B)is always issued in fixed denominations (for example $1,$5,$10,$20 bills).
• C)allows people to value all goods and services in terms of one commodity (money),rather than in terms of several commodities.
• D)makes it easier for people to maintain value across time by letting them save it in the form of money,rather than in the form of physical goods that might depreciate over time.

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Definitions:

Aggregate Demand

Aggregate demand represents the total demand for goods and services in an economy at a given time and price level.

Taxes

Compulsory financial charges or levies imposed by a government on individuals or entities to fund public expenditures.

Government Spending

The total amount of public expenditures by the government, including spending on healthcare, education, infrastructure, and defense.

Pessimism

A tendency to see the worst aspect of things or believe that the worst will happen; a lack of hope or confidence in the future.