Money Cannot Serve as a Medium of Exchange Unless It

question 147

Essay

Money cannot serve as a medium of exchange unless it also serves as a store of value.Is this statement true or false? Explain.

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Definitions:

Mutual Funds

Investment programs funded by shareholders that trade in diversified holdings and are managed by professional investment managers.

Index Funds

Index Funds are mutual funds or exchange-traded funds (ETFs) designed to follow certain preset rules so that the fund can track a specified basket of underlying investments.

Efficient Markets Hypothesis

The Efficient Markets Hypothesis suggests that asset prices in financial markets fully reflect all available information at any given time, making it impossible to consistently achieve higher returns than the overall market.

Interest Rate

The cost of borrowing money, expressed as a percentage of the amount borrowed, that lenders charge borrowers or the rate earned by depositors.