Money may not be accepted as a store of value if?

Assessment: JAMB UTME - Economics - 2001 Subject: Economics

Question 1 Report

Money may not be accepted as a store of value if?
Answer Details
Money may not be accepted as a store of value if its value is unstable. This means that if the value of money keeps fluctuating, people may lose confidence in it as a store of value. Inflation and deflation are examples of factors that can cause the value of money to become unstable. When there is inflation, the value of money decreases, while deflation causes an increase in the value of money. For example, if someone saves money in a currency that experiences hyperinflation, the value of their savings will decrease rapidly over time. As a result, they may choose to save their money in a different currency or invest it in assets that retain their value better. Therefore, the correct answer to the question is: Money may not be accepted as a store of value if its value is unstable.

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