A disadvantage of using a commodity money as a store of value is that:
A)money is not portable.
B)it requires a double coincidence of wants.
C)currency is intrinsically worthless.
D)the value of money falls if the commodity is not durable.

Question

Quizplus · Accepted Answer

Commodity money derives its value from its intrinsic value as a commodity. If the commodity used as money is not durable, its value will decline over time, making it a poor store of value. Portable money (A) and the requirement of a double coincidence of wants (B) are disadvantages of barter trade, not commodity money. While currency is intrinsically worthless (C), it can still function as a medium of exchange if it is widely accepted by the society.

A Disadvantage of Using a Commodity Money as a Store