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Multiple Choice
Money functions as a store of value if it allows you to:
A
facilitate immediate consumption only
B
measure the relative worth of different goods
C
exchange goods and services directly without a medium
D
save purchasing power for future use
Verified step by step guidance
1
Understand the concept of 'store of value' in the context of money. It means that money can retain its value over time, allowing individuals to save purchasing power for future use.
Recognize that facilitating immediate consumption relates to money's function as a medium of exchange, not as a store of value.
Measuring the relative worth of different goods corresponds to money's function as a unit of account, which helps compare prices.
Exchanging goods and services directly without a medium describes barter, which is not a function of money.
Conclude that the correct function of money as a store of value is its ability to save purchasing power for future use.