Nicholas needs to decide between buying a new home gym for $1,800 or being able to go on a Florida vacation for $1,000 and still having enough left over to buy a new set of free weights for $800. Nicholas opts for the new set of free weights and the Florida vacation. Nicholas has used money in what ways in making his decision? A. Medium of exchange and a standard unit of account. B. Store of value and a standard unit of account. C. Medium of exchange and a store of value. D. Medium of exchange and a method to decrease deferred payments.

Question

Bryanna

Business

25 October, 13:28

Nicholas needs to decide between buying a new home gym for $1,800 or being able to go on a Florida vacation for $1,000 and still having enough left over to buy a new set of free weights for $800. Nicholas opts for the new set of free weights and the Florida vacation. Nicholas has used money in what ways in making his decision? A. Medium of exchange and a standard unit of account. B. Store of value and a standard unit of account. C. Medium of exchange and a store of value. D. Medium of exchange and a method to decrease deferred payments.

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Answers (1)

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Adrienne Washington · Answer 1

The correct option here is A) Buying new weights comes under medium of exchange and opting to go for Florida vacation comes under a standard unit of account.

Explanation:

When money is accepted by a seller or producer as a payment for market transaction, then we can say that money is used as a medium of exchange. In this question an example of this is, when Nicholas buys new free weights from the market.

When money is used as a standard of value, which allows for comparison to be made between relative worth of goods and services, then we can say money is used as a standard unit of account. An example of this is Nicholas opting to go on Florida vacation.