Final answer:
Lance's house acted as a 'store of value' because he was able to sell it for more than the purchase price after a period, indicating its value was preserved or increased.
Step-by-step explanation:
Lance paid $175,000 for his house in 2003 and sold it for $325,000 in 2006. The function that the house served during the time Lance owned it was as a store of value. A store of value is something that can be saved and retrieved in the future with the confidence that its value will be preserved or increased. In Lance's case, he was able to sell the house after three years for a substantially higher price than the purchase price, indicating that the house indeed served as a good store of value.
A house doesn't usually serve as a medium of exchange or a unit of exchange because it's not used to buy goods or services directly. It also isn't typically considered a unit of account; it doesn't assign a value to other items or services. Therefore, the correct option is C. store of value.