When money provides a yardstick that allows individuals to compare the relative values of goods and services, it is functioning as a
A) medium of exchange.
B) unit of accounting.
C) store of value.
D) standard of deferred payment.

Question

Quizplus · Accepted Answer

A unit of account is a monetary standard used to value goods and services, which means that money provides a yardstick that allows individuals to compare the relative values of goods and services. Medium of exchange refers to the ability of money to be used to buy goods and services, store of value refers to the ability of money to maintain its worth over time, and standard of deferred payment refers to the use of money to settle debts or make payments at a later time.

When Money Provides a Yardstick That Allows Individuals to Compare