Question

Which of the following function does money serve when used to purchase or sell different goods and services?

• A. Store of value
• B. Medium of exchange
• C. Standard of value
• D. Display of power

Answer 1

Answer: (B)

Medium of exchange

Money refers to a common medium of exchange that is issued under the law of government and acts as a legal tender for the whole country. As a medium of exchange, money functions as a mode of exchanging goods and services. In this function of money, money is used to purchase or sell different goods and services in the market.