Question

function of money and credit​

Answer 1

The most important function of money is to serve as a medium of exchange or as a means of payment.

Money, being a unit of value and a generally acceptable means of payment, provides a liquid store of value because it is so easy to spend and so easy to store.

Money also functions as a means of transferring value.

Answer 2

Another important function of money is the basis of credit. Credit is an important aspect of the modern economic system and also money constitutes the basis of the credit. The bank creates credit on the basis of the deposits made by people on the bank.


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