Functions of Money

Money as a medium of supervene upon is an detail that buyers give to sellers when they want to purchase propers or services. An example of how I use silver as a medium of step in is simple. Every week when I do my grocery shopping, I give the cashier currency, whether it is in the form of cash, or account political machined, in exchange for groceries. Money as a social unit of account is the yardstick sight use to post values and read debt. When we want to measure and record economic value, we use money as the unit of account. The unit of account function of money refers to the fact that the prices of different goods are verbalized in a common monetary unit. For example, prices in the US are expressed in dollars. An example of this function on money office be that the cost of bread is two dollars per loaf and the price of wine is six dollars per store. Without a common unit of account, we would swan that a loaf of bread costs one-third bottle of wine and a bottle of wine costs ternion loaves of bread. A store value of money is an item that people can use to transfer purchasing power from the generate to the future. When a seller accepts money today in exchange for a good or service, that seller can go the money and become a buyer of another good or service at another time.

Money is not the only store of value in the economy, for a person can also transfer purchasing power from the nonplus to the future by holding other assets such as nonmonetary assets. An example of store of value as a nonmonetary consummation would be cost reduction. My fiancé owns an auto detailing business. He charges the car dealerships a reduced rate from $250 to $150 per car for a full detail and from $10 to $6 per car for a wash and wax in return that the dealership keeps bad him their business per a contracted deal. An example of money as a store of value would be my fiancé excepting money from customers in return for his services, then using the money to reinvest in supplies for his business, and chip in his employees. If you want to get a full essay, order it on our website: Orderessay

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