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The Statement “This Dell Laptop Costs $1,200” Illustrates Which Function of Money?

Last Updated on September 18, 2022 by Climent Rick

The statement “this Dell laptop costs $1,200” illustrates the function of money as a store of value. This is because money can be used to purchase goods and services at a later date. In this case, the Dell laptop will cost $1, 200 in cash or equivalent funds.

Money acts as a store of value because it can be used to purchase items at a later date.

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The statement “this Dell laptop costs $1,200” illustrates the function of money as a unit of account. This means that money is used to measure the value of goods and services. In this case, the Dell laptop is being valued at $1,200.

Money is also used as a medium of exchange, which means it is used to buy goods and services. In this case, someone could use $1,200 to buy the Dell laptop. Finally, money serves as a store of value, which means it can be saved and used in the future.

In this case, someone could save $1,200 in order to purchase the Dell laptop at a later date.

Which of the Following Criteria Would Make Gold a Poor Medium of Exchange?

Gold is often thought of as a good medium of exchange, but there are actually several reasons why it would be a poor choice for this purpose. First, gold is very difficult to transport and store due to its high density. This makes it impractical for use in small transactions.

Second, the value of gold can fluctuate quite significantly, which makes it difficult to use as a stable unit of account. Finally, gold is not divisible into small units, making it inconvenient for use in many everyday transactions.

Most Payments in the United States for Goods And Services are Made Using

In the United States, most payments for goods and services are made using paper currency and coins. However, there are a number of other payment options available. These include credit cards, debit cards, checks, and electronic transfers.

Paper currency and coins are the most common form of payment in the United States. This is because they are easy to use and widely accepted. Credit cards, debit cards, and checks are also common forms of payment.

However, they each have their own advantages and disadvantages. Credit cards allow you to borrow money from a lender and then pay it back over time. They can be used for both small purchases and large purchases.

However, if you do not pay your bill in full each month, you will be charged interest on the outstanding balance. Debit cards are similar to credit cards but they do not allow you to borrow money from a lender. Instead, they withdraw funds directly from your bank account when you make a purchase.

Checks can be used to pay for goods or services but they take longer to process than other forms of payment. Electronic transfers are becoming more popular as they offer a fast and convenient way to send or receive payments electronically.

Which is Not One of the Criteria Necessary for a Commodity to Make a Suitable Medium of Exchange?

A commodity must have a few specific characteristics to make it suitable as a medium of exchange. It must be durable, divisible, and portable. It also must have relatively low storage costs and be easy to transport.

Lastly, it should not degrade over time. One criteria that is not necessary for a commodity to make a suitable medium of exchange is that it be scarce. Although commodities that are rare may be more valuable, there is no reason why a less scarce commodity couldn’t also serve as an effective medium of exchange.

Fiat Money is Generally Issued by

Most people think of money as currency, something that is used to purchase goods and services. But the fact is, fiat money is generally issued by governments and not backed by anything tangible. Fiat money is simply paper or coins that have been declared by a government to be legal tender.

It’s not backed by gold or silver, but simply by the faith and credit of the issuing government. In other words, it has value because we believe it does. While this might seem like a shaky foundation for our financial system, fiat money has actually been around for centuries and has proved to be surprisingly durable.

The key is that fiat money must be managed responsibly by the issuing government. If too much is printed, it will lose its value (as we’ve seen happen in some countries). But if it’s managed properly, fiat money can provide a stable currency for an economy.

Liquidity is Defined As

Liquidity is defined as the ability to buy or sell an asset quickly and at a fair price. In the world of investing, liquidity is often used to describe a company’s ability to meet its short-term obligations. A company with high liquidity has plenty of cash on hand and can easily pay its bills.

A company with low liquidity might have trouble paying its bills if it doesn’t have enough cash on hand. There are two types of liquidity: primary and secondary. Primary liquidity refers to a company’s cash reserves and other assets that can be quickly converted into cash, such as investments in short-term government bonds.

Secondary liquidity refers to a company’s ability to raise capital by selling equity or taking out loans. A company’s level of liquidity can change over time, depending on factors such as its financial health, the state of the economy, and market conditions. For example, a growing company might need to take out loans to finance expansion, which would reduce its primary liquidity but improve its secondary liquidity.

Conversely, a struggling company might lay off workers or sell assets to raise cash and improve its primary liquidity but hurt its secondary liquidity. Investors often assess a company’s liquidity before deciding whether or not to invest. They want to know that the companies they invest in will be able to meet their financial obligations and continue operating even during tough economic times.

What is the Function of Money

Assuming you would like a blog post discussing the functions of money: Money is often thought of as simply a means of exchange, but it actually performs several important functions. Money is a unit of account, which means it provides a common measure for goods and services.

This allows buyers and sellers to compare prices and make informed decisions about what they want to purchase. Money is also a store of value, which means it can be saved and used in the future. This is important because it allows people to smooth out their consumption over time by saving during periods when income is high and using those savings during periods when income is low.

Finally, money is a medium of exchange, which means it can be used to buy goods and services without having to barter for them.

Conclusion

The statement “this Dell laptop costs $1,200” illustrates the function of money as a unit of account. Money is a unit of account because it provides a common measure of value that can be used to compare the prices of different goods and services. The Dell laptop example shows that money can be used to compare the prices of different laptops.

In this case, the price of the Dell laptop is $1,200, which is more expensive than other laptops on the market.

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