Money serves three critical roles in an economy.
Firstly, it acts as a medium of exchange, facilitating the exchange of goods and services by eliminating the need for barter.
Secondly, it functions as a measure of value, providing a common unit of account for comparing the worth of different goods and services.
Lastly, money serves as a store of value, allowing individuals to save and store wealth for future use, as it retains its value over time, reducing the need for immediate consumption.
These roles collectively contribute to the efficiency and stability of economic transactions and systems.