One Major Advantage of the Medium of Exchange Function of Money

question 174

Multiple Choice

One major advantage of the medium of exchange function of money is that it allows society to:

• A)transfer purchasing power from the present to the future.
• B)measure the relative worth of products.
• C)escape the complications of barter.
• D)use credit cards instead of currency.

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Definitions:

Adapt

The act of making adjustments or changes in order to better suit a new environment, situation, or set of conditions.

Liquidity

The ease with which an asset or security can be converted into ready cash without affecting its market price.

Asset

An asset is a resource owned or controlled by an individual, corporation, or government with the expectation that it will produce positive economic value.

Cash

A form of liquid asset that includes currency and other easily accessible bank balances.