How Does Money Function as a Unit of Account?​

question 86

Multiple Choice

How does money function as a unit of account?​

• A)Money has intrinsic worth as a commodity.
• B)Money is convertible into commodities that have intrinsic worth.
• C)The prices of all goods and services are measured in terms of money.
• D)Things that function as money can do so because people know there is a standard of value that ultimately backs the money even if it is only faith.
• E)Bank accounts make it easy for people to store their wealth.

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Definitions:

Unrealized Loss

A decrease in the value of an investment that has not yet been sold and thus, the loss has not been realized.

Gain on Sale of Investment

The profit realized from selling an investment for more than its purchase cost.

Fair Value

The estimated market value of an asset or liability based on current prices in an open and competitive market.

Equity Securities

Financial instruments that represent ownership in a company, such as stocks, entitling holders to dividends and capital gains.