In this article we will discuss about the primary, secondary and contingent functions of money. 1. Primary Functions: These are the fundamental (or basic) functions of money and include the following: a. Medium of exchange: The most important function of money is that it is a common medium of exchange. Due to the introduction of money, commodities are not exchanged [...]
The following points highlight the top four functions of money. The functions are: 1. A Medium of Exchange 2. A Measure of Value or Unit of Account or Means of Valuation 3. Store of Value 4. Standard of Deferred Payment. Function # 1. A Medium of Exchange: Money serves as a medium of exchange for all kinds of goods and [...]
The following points highlight the top six functions of money. Function # 1. A Medium of Exchange: The only alternative to using money is to go back to the barter system. However, as a system of exchange the barter system would be highly impracticable today. For example, if the baker who supplied the green-grocer with bread had to take payment [...]