The use of money in an economy does which of the following?

Question

Quizplus · Accepted Answer

Money promotes specialization and the division of labor by allowing individuals to trade goods and services without needing a direct exchange of equal value. This allows individuals to specialize in producing goods or services in which they have a comparative advantage, leading to increased efficiency and overall economic growth. The other options are incorrect: A is eliminated because the use of money eliminates the need for a double coincidence of wants; C is eliminated because money is divisible and can be used to trade portions of indivisible goods; D is eliminated because money can actually contribute to inflation in certain circumstances; and E is eliminated because the use of money replaces the need for barter.

The Use of Money in an Economy Does Which of the Following