Final answer:
Money is an item widely accepted for exchange, stores value, and can repay debt. It includes commodity and fiat money, and liquidity determines its ease of use in transactions.
Step-by-step explanation:
Money is defined as any good that is widely accepted for purposes of exchange and serves as a store of value. This includes being used for the repayment of debt and as a standard of deferred payment. Money's main functions are to act as a medium of exchange, a unit of account, a store of value, and a standard of deferred payment.
Commodity money has intrinsic value and fiat money is government-declared legal tender without intrinsic value. Liquidity is essential in money, determining how quickly a financial asset can be used to purchase goods and services.