What is Money and its Functions?
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Questions and Answers

What is the primary function of money as discussed in the text?

  • Store of value
  • Settling a debt
  • Medium of exchange (correct)
  • Unit of account

Which function of money refers to the ability to hold it temporarily and exchange it for goods and services later?

  • Medium of exchange
  • Means of payment
  • Store of value (correct)
  • Unit of account

What would be the consequence if an economy relied solely on barter instead of using money?

  • Lower costs associated with trade
  • Increased efficiency in transactions
  • Simplified comparison of prices
  • Need for a double coincidence of wants (correct)

Which type of money includes currency, traveler's checks, and checking deposits in its definition?

<p>M1 (C)</p> Signup and view all the answers

In the context of Bangladesh, what does 'M2' represent?

<p>M1 plus time, saving deposits, and other deposits (C)</p> Signup and view all the answers

Which function of money allows for easier comparison of the prices of different goods and services?

<p>Unit of account (D)</p> Signup and view all the answers

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