Money is used to pay for goods and services, promoting economic efficiency by eliminating the time spent on exchanging goods and services
Transaction cost
Time spent trying to exchange goods or a service in a barter economy
Barter economy
People have to satisfy a "double coincidence of wants"—they have to find someone who has a good or service they want and who also wants the goods or services they have to offer
Unit of account
Money is used to measure value in the economy, enabling an orderly pricing system essential for rational economic calculation and choice, and transmitting economic information among individuals
Store of value
Money is a repository of purchasing power over time, allowing people to save purchasing power from the time income is received until it is spent
Liquidity
The relative ease and speed with which an asset can be converted to a medium of exchange
Standard of deferred payments
Money lets you buy now and pay later, or lend now and collect later, permitting the easy transfer of resources out of their less desired (less productive, less profitable) uses and into their more desired (more productive, more profitable) uses
