money

What is Money?

The main function of money is as a medium of exchange for goods and services. Money allows people to get the things they need and desire to live. It is an economic unit of measurement, used for transactions within an economy.

The main functions of money include, it is a unit of measurement/ account, it is a store of value and it allows for deferred payments. There are 2 main types of money we use today: Fiat Money and Cryptocurrency.

cryptocurrency and money

Some functions of Money:

  • A Unit of Measurement/Account – Money can be used to track the value of units gained or lost across multiple transactions or exchanges of goods and services.
  • Store of Value – Transactions with money are usually based on future intent. Thus, money provides a way to store and retain current value today for future use in transactions tomorrow.
  • Allows for Deferred Payment – Being able to store value, money can now be used to transfer that value through time via the tools of credit and debt. A quantity of money can be loaned from one person to another and an agreed-upon value (quantity) can be repaid across a period of time.

 

For more information on money and its many functions, see https://www.investopedia.com/insights/what-is-money/

 

Recommended Posts

No comment yet, add your voice below!


Add a Comment