Question
Explain the different definitions of money.

Answer

  • Scitovsky states that “Money is a difficult concept to define, partly because it fulfills not one but three functions, each of them providing a criterion of moneyness those of a unit of account, a medium of exchange, and a store of value”.
  • Sir John Hicks, says that “Money is defined by its functions, anything is money which is used as money, “Money is what money does”.
  • Some economists define money in legal terms saying that “anything which state declares as money is money”.

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