Which of the following is NOT a function of money?

Correct option is A

The correct answer is (a) Barter System.
· Barter System is a system of exchange where goods and services are directly exchanged for other goods and services without using money.
· It is not a function of money.
· However, barter can be time-consuming and costly because it requires finding someone who wants what you have and has what you want.
· Money is a medium of exchange that is widely accepted in transactions involving goods, services, or repayment of debts.
· Store of Value: Money can be saved and retrieved in the future, maintaining its value over time.
· Unit of Account: Money provides a common measure for valuing goods and services.
· Medium of Exchange: Money facilitates transactions by eliminating the need for a double coincidence of wants that is required in a barter system.
Facts to remember:
· The concept of money and its functions is central to any study of the economy.
· Money facilitates trade, enabling a more efficient allocation of goods and services.
· Without money, economies would rely on the barter system, which is inefficient due to the need for a double coincidence of wants.
· Money also plays a crucial role in the macro-economy by influencing key variables such as interest rates, prices, wages, and economic growth.
· Central banks, such as the Reserve Bank of India (RBI), manage the money supply to control inflation and stabilize the economy.