Question

why is money called a medium of exchange?

Answer 1

Money actually serves several different key functions in our economy. It is a medium of exchange, a unit of account, and a store of value. ... Money helps to facilitate trade because people in the economy generally recognize it as valuable.

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Answer 2

Money is called medium of exchange because money is a widely accepted token that can be used for exchange of any good or service.

In old days barter system was used as medium of exchange and later it was gold. Now-a-days it is money both in physical and digital form which serves as a medium of exchange.