The functions of money (AS/A LEVELS/IB/IAL)

The functions of money (AS/A LEVELS/IB/IAL)

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The functions of money

There are three key functions of money.

  1. Medium of Exchange  

Money is used around the world to buy and sell products. This is the main function and helps to facilitate transactions.

  1. Measure of Value  

It provides a uniform value for products and services  allowing them to be compared.

  1. Store of Value

Money can be stored in banks to gain interest. Money is also very liquid and can easily be used to purchase goods and services.

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