Question

Match the statements with the appropriate definition. Not all statements will be used.

1. Money is best defined as
a. whatever serves society in three functions: medium of exchange, store of value, and unit of account.
b. whatever the government allows money to be.
c. paper bills and coins.

2. Barter is best defined as
a. an informal market such as a flea market.
b. literally trading one good for another without using money.
c. a situation where two individuals each want some or service that the other can provide.

3. A double coincidence of wants is:
a. a situation where two individuals each want some or service that the other can provide.
b. a situation in which money is used to facilitate economic transactions.
c. literally trading one good for another without using money.

Answer 1

Money is best defined as whatever serves society in three functions: medium of exchange, store of value, and unit of account.

Barter is best defined as literally trading one good for another without using money.

A double coincidence of wants is a situation where two individuals each want some or service that the other can provide.

Step-by-step explanation:

Barter is trading one good for another without the use of money. Barter is the system where two or more parties directly exchange their goods and service between each other without the use of money.

A double coincidence of wants is a situation in which two individuals each want some good or service that the other can provide. In a barter system, the only trades that people make are those that satisfy this condition. Double coincidence is a system where two individual meet and swap their goods in exchange for others goods.

Money is whatever serves society in three functions: medium of exchange, store of value, and unit of account. As medium of exchange means that can be used to buy anything, store of value means that can be store for future purpose, unit of account as there are numerical unit of money.