To determine which option does not represent a function of money, let’s briefly define the main functions of money:
- Store of Value: Money allows individuals to save purchasing power for the future. It retains value over time, making it a reliable means of saving.
- Medium of Exchange: Money is widely accepted in transactions for goods and services, facilitating easier trading compared to barter systems.
- Unit of Account: Money provides a standard measure of value, allowing for easy comparison of the worth of different goods and services.
Now, let’s examine the options given:
- a) Store of Value: This is indeed a function of money.
- b) Price Mechanism: This is not a function of money. Instead, the price mechanism refers to how prices are determined in a market economy through supply and demand.
- c) Medium of Exchange: This is a primary function of money.
- d) Unit of Account: This is another essential function of money.
Therefore, the correct answer is b) price mechanism, as it does not describe a function of money.