Money

Purposes of money

• Unit of account

  A way to compare value of goods or services

• Medium of exchange

  Allows for non-barter transactions

• Store of value

  Allows value to be retained

• Transfer of value

  Ease of transfer of value

Characteristics

• Durabilty: able to repeated reuse

• Portability

• Divisibility: Fractional unit, e.g. a dollar can be divided into 100 cents.

• Uniformility: The version of the same currency has the same value.

• Limited supply

• Acceptablity

• Stability