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Functions of Money

Question

State the functions of money.

Category:

Economic Systems

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STEPS TO WRITE ESSAY 💡MAIN POINTS💡OVERVIEW

I. Introduction
- Definition of money and its importance in economics
- Brief explanation of the four functions of money

II. Unit of Account/Measure of Value
- Definition and explanation of unit of account/measure of value
- Importance of having a common unit of measurement in economic transactions
- Examples of how unit of account is used in everyday life

III. Store of Value
- Definition and explanation of store of value
- Importance of having a reliable store of value
- Factors that affect the value of money as a store of value
- Examples of how people use money as a store of value

IV. Standard of Deferred Payment
- Definition and explanation of standard of deferred payment
- Importance of having a standard for future payments
- Examples of how standard of deferred payment is used in loans and contracts

V. Medium of Exchange
- Definition and explanation of medium of exchange
- Importance of having a common medium of exchange
- Factors that affect the efficiency of money as a medium of exchange
- Examples of how money is used as a medium of exchange in different economic systems

VI. Conclusion
- Recap of the four functions of money
- Importance of money in economic transactions
- Final thoughts on the role of money in the economy.

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