Explanation Money is anything that serves the main three functions such as the medium of exchange, unit of account and store of value. In the case of the stone rounds in the Y country, the stone rounds fulfills these three primary functions of money. But there are some other desirable functions of money and they are the divisibility, transportability, availability as well as the uniformity. The divisibility means that the money should be divisible into fractions. This is because, some items would be indivisible and they should be purchased with smaller denominations of money. Thus, the money should be divisible to solve this issue in the economy. In the case of the stone rounds, the broken stone rounds are not valued and thus, they are not divisible. The people makes use of the other items such as bead necklaces as well as other forms of small money like beer and yar etc...

Stone rounds and other desirable properties of money.

MACROECONOMICS FOR TODAY

10th Edition

ISBN: 9781337613057

Author: Tucker

Publisher: CENGAGE L

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Question

Chapter 14.1, Problem 2GE

To determine

Stone rounds and other desirable properties of money.

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Similar questions

Can you name some item that is a store of value, but does not serve the other functions of money?

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