Question

Van is heading out to lunch. He goes to the bank and withdraws $30 from his savings account. He heads to a local deli that sells half sub sandwiches for $4.99 and whole subs for $7.99. Eric decides that he's pretty hungry and goes for the whole. He pays with a $10 bill and tells the cashier to keep the change.

Identify what role money plays in each of the following parts of the story.
a. Role of money medium of unit of store
b. Exchange account of value
c. Eric can easily determine that the whole sandwich, while twice as long as the half, is priced at less than twice as much.
d. Eric accumulates money in his savings account for future purchases.
e. Eric buys his lunch with a $10 bill.

Answer 1

Answer and Explanation:

c. In the given case Eric valued the goods in terms of money so here the role of money plays is the unit of account that represent something that can be used in order to value the goods and services

d. In the case when eric wants to store the money and use them in a future so here it is storing of value

e. In this case, eric purchased the lunch and pay $10 so here the food is exchanged with the money that represent the medium of exchange