Functions of money does not include_______

1. Analyze the question The question asks which option is not a function of money. Be careful: "does not include" means we are looking for the odd one out.

2. The concept: functions of money Money performs four main functions in economics:

1. Medium of exchange: it is used to buy and sell goods and services, which removes the problem of barter.
2. Measure of value (unit of account): it lets us express the worth of goods and services in prices.
3. Store of value: it lets us save purchasing power for future use.
4. Standard of deferred payment: it lets us settle debts and credit transactions in the future, such as loans.

Characteristics (qualities) of money are different. These include general acceptability, durability, portability, divisibility, scarcity or limited supply, homogeneity and stability in value.

3. Step-by-step solution

• A. Store of value is a function.
• B. Medium of exchange is a function.
• C. Standard of deferred payment is a function.
• D. General acceptability is a characteristic of money. It is what makes money able to work as a medium of exchange, but it is not a function in itself.

So the option that is not a function of money is D.

4. Answer D. General acceptability

5. Exam tip Students often confuse the functions of money with its qualities. Remember it this way:

• Functions are what money does: exchange, measure, store, defer payment.
• Characteristics are what money has: acceptability, durability, portability, divisibility, scarcity.

When you see "does not include" or "except", check each option and separate the "does" items from the "has" items.