3. Which one of the following is not a feature of money?(A) Medium of exchange(B) Lack of divisibility(C) A store of value(D) A unit of account
Question
- Which one of the following is not a feature of money?(A) Medium of exchange(B) Lack of divisibility(C) A store of value(D) A unit of account
Solution
To determine which one of the options is not a feature of money, we need to analyze each option and identify if it aligns with the characteristics of money.
A) Medium of exchange: Money serves as a medium of exchange, allowing individuals to trade goods and services without the need for bartering. This is a fundamental feature of money.
B) Lack of divisibility: Money should be divisible into smaller units to facilitate transactions of varying values. However, the statement suggests that lack of divisibility is a feature of money, which is incorrect. Therefore, option B is not a feature of money.
C) A store of value: Money should be able to retain its value over time. This allows individuals to save and accumulate wealth. A store of value is indeed a feature of money.
D) A unit of account: Money serves as a common unit of measurement for the value of goods and services. It allows for easy comparison and calculation of prices. A unit of account is also a feature of money.
Therefore, the correct answer is option (B) Lack of divisibility, as it is not a feature of money.
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