Let’s talk about money and, more specifically, the functions and characteristics of money. We use money every day, but how often do we really think of it? Sure, we check the amount we have sitting in our bank account, but that’s typically it. Economists generally define money as a commodity accepted by general consent as a medium of exchange. But that’s not the only thing money does. Besides being a medium of exchange, money also accounts as a unit of account and a store of value. No matter if we are talking about money as cowry shells<\/a> in Africa to strings of beads that the Native Americans used, money must be able to fulfill these functions. Without money being able to fulfill these three important functions, then what we consider money would not last nor be used consistently. <\/p>\n\n\n\n

The Three Primary Functions Of Money<\/h2>\n\n\n\n

Throughout the history of money, there have always been three primary functions that money serves in an economy: a medium of exchange, a unit of account, and a store of value. <\/p>\n\n\n\n

Let’s break these down a little further. <\/p>\n\n\n\n