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Functions of Money

Money serves three main purposes.  They are:

Store of Value: People will hold on to money in order to trade it in the future for goods and services.

Unit of Account: This is how we measure economic transactions.  This provides a place for how debts are recorded and prices are quoted.

Medium of Exchange: This is how money is used in transactions for goods and services. 

Money is important and facilitates the movement of goods and services directly and indirectly.

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