When a worker gets paid weekly but pays his bills at the end of the month,money functions as __________ during the month.
Question
When a worker gets paid weekly but pays his bills at the end of the month,money functions as __________ during the month.
Solution
The money functions as a "store of value" during the month.
Here's the step by step explanation:
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When a worker gets paid weekly, he receives a certain amount of money for the work he has done. This money is a "medium of exchange", which is one of the primary functions of money. It is what the worker gives in exchange for goods and services.
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However, the worker does not spend all this money immediately. He has bills to pay at the end of the month. So, he needs to keep some of his money until then.
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During this time, the money is not just sitting idle. It is serving a very important function - it is storing value. This is another primary function of money.
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The worker can hold onto his money, knowing that it will still have value when it's time to pay his bills at the end of the month. This is why we say that money functions as a "store of value" during the month.
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