Which of the following is an advantage of using money as a medium of exchange?
A) It simplifies purchases because all prices are specified in money values.
B) There is no interest charged on using money for purchases.
C) It is easy to mass produce money.
D) It avoids having to rely on barter, the exchange of one good or service for another.

Question

Quizplus · Accepted Answer

Using money as a medium of exchange avoids the inconvenience and limitations of bartering, which requires a coincidence of wants between the parties involved in the transaction. Money provides a universally accepted medium of exchange that enables buyers and sellers to participate in markets without having to directly exchange goods or services. Options A, B, and C are not advantages of using money as a medium of exchange: A is a characteristic of price labeling that facilitates comparison shopping, but it doesn't depend on the use of money; B is not true because some forms of payment (such as credit cards) may involve interest charges; and C is indifferent to the use of money since it is a technical feature of the production process, not a function of money as a social institution.

Which of the Following Is an Advantage of Using Money