Question

Betty won $500 in a poker tournament. She deposits her $500 winnings into a money market fund so that she can use the money next year to help her pay for a trip to Las Vegas. This is an example of money serving as a(n)

Answer 1

Answer:

Store of value.

Explanation:

Money can be defined as any asset used by an individual or business entity to make purchases of goods and services at a specific period of time.

Simply stated, money refers to any asset which can be used to purchase goods and services by customers.

This ultimately implies that, money is any recognized economic unit that is generally accepted as a medium of exchange for goods and services, as well as repayment of debts such as loans, taxes across the world.

Generally, the three (3) main functions of money all over the world are;

I. Medium of exchange.

II. Unit of account.

III. Store of value.

Money functioning as a "store of value" simply means that, it adds to the purchasing power of a consumer over a period of time.

Hence, money being a store of value makes it possible to transfer purchasing power between traders and buyers from the present to the future.

In this scenario, Betty won $500 in a poker tournament and deposits her winnings into a money market fund to enable her use the money to pay for a trip to Las Vegas next year. Thus, this is an example of money serving as a store of value.