Which function of money allows people to specialize in areas in which they have a comparative advantage?
A) Medium of exchange
B) Unit of accounting
C) Store of value
D) Standard of deferred payment

Question

Quizplus · Accepted Answer

The medium of exchange function of money allows individuals to trade goods or services for money, which can then be used to purchase other goods or services. This, in turn, enables people to specialize in areas where they have a comparative advantage, as they can use the money they earn from selling their specialized goods or services to purchase other goods or services that they need, but are not able to produce themselves.

Which Function of Money Allows People to Specialize in Areas